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US Retail Sales And Greece Talks In Focus

Published 2017-05-12, 09:05 a/m
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Stock markets are mixed around the world Friday. US index futures are trading down 0.2%, while European indices are steady to up slightly. Currency action is also mixed with the US dollar up GBP and CAD but down slightly against EUR, JPY and gold. Crude oil is steady, holding on to nearly all of its recent rebound.

It appears that a lot of news has already been priced into markets and between earning season ending plus the summer approaching, exhausted and complacent traders appear to be looking for something new.

For example, recent polling for French parliamentary elections show Macron's party leading at 29% and the combined support for centre to right parties at 69%. One would think the street would see this as business friendly. However, in reaction to what should be good news for markets, the CAC and EUR are doing pretty much nothing. This can be seen as a sign the rally of recent months may be near exhaustion and vulnerable to a shift in sentiment.

Keeping with politics, G7 finance ministers are meeting today ahead of the upcoming G7 summit. Ministers aren't expected to make much progress on trade so they may be looking to talks being held on the sidelines about Greece's debt for a breakthrough. Some kind of debt relief through swapping higher interest debt for lower interest debt may be possible along with a partial payback. The goal appears to be to do just enough to keep social unrest in Greece from exploding this summer before the German election. It also may set the stage for turmoil in 2018 when Greece's current bailout program ends and Italy is scheduled to vote with Euroskeptics leading.

Although the Trump-Comey sideshow continues to suck up media attention‎, traders may focus more on today's US data. Retail sales and inflation are due with traders looking for signs of whether the US economy is picking up into the spring and if there is any reason that could stop the Fed from raising interest rates in June.

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