Atlanta, GA 6/29/12 (StreetBeat) -- Stocks were strong in Asian trade. The Hang Seng was among the best with a gain of more than two percent and the Nikkei rose one and a half percent, while Shanghai and Australia both added more than one percent. European indexes are very well bid this morning, with the Footsie better by one and a half percent, the Dax up more than two and a half percent and Spain better by about three percent. US stock futures are up by one percent or more.
*The May reading of Japan’s Jobless Rate is 4.6%, down two tenths from the month before and one tenth below the forecast.
*The May reading of Japan’s Consumer Price Index ex-fresh food is -0.1% year on year; a tenth under the estimate and down from +0.2% in April. The June reading of that same inflation measure for Tokyo is -0.6% year on year, but that is one tenth less deflationary than expected.
*The preliminary May reading of Japanese Industrial Production is -3.1% month on month, three tenths worse than expected.
*The euro zone announced that they plan on using EFSF/ESM funds to directly support Spanish banks and these loans will not carry senior status. The EU will additionally take steps on establishing a banking union, with preliminary structure for that to be announced in a few months time. As is usually the case with these summit generated plans there is a shortage of available details. Some are significant, such as: the ESM still needs to be ratified by all of the euro area parliaments. Merkel has reiterated her resistance to euro bonds and she must convince her Bundestag that the direct funding of the banks is not a radical departure from the already established ESM guidelines.
*The May reading of German Retail Sales is -0.3% on a monthly basis, missing the forecast for a monthly gain of 0.2%.
*The April reading of Canada’s GDP is due out at 7:30am CDT, it is expected to be +0.2% on a monthly basis and +1.8% year on year.
*The May reading of Personal Income and Spending is due out at 7:30am CDT. Spending is expected to be +0.2% on the month and the estimate for Spending is 0.0% month on month. The headline PCE inflation measure, the Fed’s benchmark, is expected to be 1.5% year on year, down from 1.8% the month before. The Core PCE is forecast to be +0.2% month on month and +1.8% annualized. The June reading of the Chicago Purchasing Managers Index is due out at 8:45am CDT, but three minutes earlier for the subscribers; it is expected to be 52.3, down just a fraction from the month before. The final June reading of consumer sentiment from the University of Michigan is set to be released at 8:55am CDT, it is forecast to be 74.1, or unchanged from this month’s preliminary result.
*The Fed is scheduled to buy Treasuries today that are due to mature between 6/30/18 and 5/15/20; the results of the operation will be announced just after 10:00am CDT. Later on, at 1:00pm CDT, the NY Fed will release next month’s Operation Twist schedule.
*There is a bit of Fed speak on the calendar today, including: NY Fed boss Dudley at 7:30am CDT and St. Louis Fed’s Bullard at 8:05am CDT.