• European bourses are firmer across the board, Euro Stoxx 50 +1.3%, continuing to take impetus from the NDX-led rebound in US hours
• Stateside, futures are mixed/flat at present, but like their European peers have been choppy in overnight ranges awaiting data and Fed speak
• DXY continues to lift, at 106.80 highs to the detriment of peers across the board ex-JPY on technical factors
• In-fitting with the above, core debt is choppy but maintains underlying upward momentum; however, Bunds were dented post-supply
• Crude benchmarks are firmer and have been moving with the equity space after yesterday's significant crude selloff; however, the 'recovery' is limited with WTI pivoting USD 100/bbl
• Looking ahead, highlights include US ISM Services PMI, FOMC Minutes, a Speech from Fed's Williams

As of 11:05BST/06:05ET

LOOKING AHEAD

• US ISM Services PMI, FOMC Minutes, a Speech from Fed's Williams.
• Click here for the Week Ahead preview.

GEOPOLITICS

RUSSIA-UKRAINE

• US State Department spokesperson Price said the time is not right for US Secretary of State Blinken to meet with Russian Foreign Minister Lavrov and the US would like to see Russia be serious about diplomacy but has not seen that yet, according to Reuters.
• US Assistant Secretary of State for Economic and Business Affairs Toloui said G20 countries should hold Russia accountable and insist that it supports the ongoing UN efforts to reopen sea lanes, according to Reuters.
• China's Vice Foreign Minister Ma said China is willing to strengthen strategic coordination with Russia within multilateral frameworks including the G20, while Russia's Foreign Minister said via a translator that the complicated world situation requires all parties to make efforts to protect international laws, according to Reuters.
• Japanese Deputy Chief Cabinet Secretary Kihara said the actual price cap figure for Russian oil will be discussed as necessary among G7 members, according to Reuters
• Russia's Kremlin says Japan is taking a "very unfriendly" position towards Russia; does not facilitate developing ties in trade and economy, including energy sector, via Reuters.

OTHER

• South Korean President Yoon held his first meeting with top military commanders and ordered the military to promptly and sternly retaliate in case of any North Korean provocation. President Yoon also called for stepped-up measures to deter North Korea's nuclear and missile programmes, as well as reduce the possibility of provocation, according to the Presidential Office.

EUROPEAN TRADE

CENTRAL BANKS

• ECB's Wunsch said If the fragmentation in bond markets is unwarranted then we should be as unlimited as possible, via the FT.
• BoE's Cunliffe said we will act to ensure the inflation shock does not become imbedded.
• BoE's Pill says the (BoE) statement re. acting forcefully if necessary reflects both my willingness to adopt a faster pace of tightening than implemented thus far in this tightening cycle & emphasis conditionality on data; Pill will be data-dependant. Much remains to be resolved before we vote on our August policy decision. Adds, that there is a case of steady-handed approach; one-off bold moves can be disturbing to markets.

EQUITIES

• European bourses are firmer across the board, Euro Stoxx 50 +1.3%, continuing to take impetus from the NDX-led rebound in US hours on Tuesday and shrugging off negative APAC trade.
• Stateside, futures are mixed/flat at present, but like their European peers have been choppy in overnight ranges awaiting US data and Fed speak; ES -0.1%.
• Back to Europe, sectors exhibit a pro-cyclical bias that features Tech as the clear outperformer.
• China's CPCA says prelim figures show China sold 1.926mln cars in June, +22% Y/Y. Prelim. figures indicate Tesla (TSLA) sold 78k (prev. 32.1k MM) China-made vehicles in June, via Reuters.
• Click here for more detail.

FX

• Dollar dips, but retains firm underlying bid ahead of FOMC minutes, Fed’s Williams and services ISM, DXY holds around 106.500 within 106.760-340 range.
• Yen outperforms on technical grounds and with JPY crosses maintaining downward momentum; USD/JPY closer to 135.00 than 136.00, but faces stiff support if breached via recent lows .
• Euro remains pressured after largely weak Eurozone construction PMIs and no real compensation from mixed retail sales data, EUR/USD slips to new 20 year low nearer 1.0200.
• Pound precarious as more UK Tory Party MPs quit to pile pressure on PM Johnson, Cable back under 1.1950 after brief rebound from low 1.1900 area.
• Yuan bucks downbeat mood in EM currencies even though China suffers more outbreaks of Covid-19 as it adopts regional safe haven status; USD/CNH and USD/CNY straddle 6.7100.
• Lira lurches again and Forint falls to fresh all time low; USD/TRY tops 17.2550 and EUR/HUF touches 410.50.
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Notable FX Expiries, NY Cut:

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FIXED INCOME

• Bulls keep debt afloat after retreat from Tuesday peaks.
• Bunds subsequently breach prior session best by a lone tick, at 151.66 before running into supply issues, as new 10 year German benchmark technically uncovered.
• Gilts back on 116.00 handle from 115.47 Liffe low and T-note hovers nearer top end of 120-03/119-21 overnight range ahead of Fed's Williams, US services ISM and FOMC minutes.
• UK debt unruffled by more UK Government resignations and BoE rhetoric awaiting PMQs that will put spotlight on under fire Conservative Party leader Johnson.
• Click here for more detail.

COMMODITIES

• Crude benchmarks are firmer and having been moving with the equity space after yesterday's significant crude selloff; however, the 'recovery' is limited with WTI pivoting USD 100/bbl.
• Goldman Sachs said oil has overshot as the global deficit is unresolved and it is premature for oil to drop on recession concerns
• OPEC Secretary General Barkindo has passed away, according to Arab News. Note, from an OPEC personnel perspective, Barkindo's term as the OPEC SecGen was due to end on July 31st, after which the Kuwaiti oil executive Haitham Al Ghais was due to replace him as the new secretary-general
• Tengiz field in Kazakhstan continues operations following a blast, according to a source cited by Reuters.
• Spot gold is lacklustre after Tuesday's USD-driven downside; notably, the yellow metal has been fairly resilient to fresh advances in the DXY. While base metals continue to falter, LME copper below 7.5k/T at worst.
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NOTABLE EUROPEAN HEADLINES

• Italy Five Star Party is leaning on keeping support for PM Draghi, according to ANSA.

NOTABLE EUROPEAN DATA

• German Industrial Orders MM (May) 0.1% vs. Exp. -0.6% (Prev. -2.7%, Rev. -1.8%)
• Swedish New Orders Manufacturing YY (May) -7.5% (Prev. 7.4%, Rev. 7.6%)
• EU S&P Global Construction PMI (Jun) 47.0 (Prev. 49.2); UK S&P Global/CIPS Construction PMI (Jun) 52.6 vs. Exp. 55.0 (Prev. 56.4)

NOTABLE US HEADLINES

• Click here for the US Early Morning note.

CRYPTO

• Bitcoin remains in close proximity to the USD 20k mark, with no convincing attempt to deviate from sub-1k ranges thus far in limited newsflow.

APAC TRADE

EQUITIES

• APAC stocks were mostly negative with risk appetite sapped by headwinds from the global growth concerns and US recession fears.
• ASX 200 was marginally lower with energy leading the descent in the commodity-related sectors, although the downside in the index was stemmed by tech strength following the duration-sensitive bias stateside and lower yield environment.
• Nikkei 225 weakened alongside a firmer currency and with Japan said to delay the call on the start of the nationwide travel support.
• Hang Seng and Shanghai Comp. conformed to the downbeat mood after the PBoC continued to drain liquidity and with reports noting that US President Biden could lift tariffs on just USD 10bln of Chinese goods, while the US was also said to pressure ASML to stop selling key chipmaking equipment to China. In addition, COVID-19 concerns persisted after China’s Xi’an city entered a 7-day period of ‘temporary control measures’ and with Macau officials locking down the Grand Lisboa hotel and casino due to a cluster of infections.

NOTABLE APAC HEADLINES

• PBoC injected CNY 3bln via 7-day reverse repos with the rate at 2.10% for a CNY 97bln net drain.
• Shanghai suspended the operation of KTV venues due to COVID-19 but other entertainment venues can remain open, while the gradual reopening of cinemas and concert venues will go ahead from July 8th, according to Reuters.
• US top diplomat for East Asia Kritenbrink said the top priority for US Secretary of State Blinken's meeting with Chinese Foreign Minister Wang is to underscore US commitment to diplomacy and maintaining open lines of communication, while he expects Blinken to raise human rights in the meeting with China's Foreign Minister, according to Reuters.
• Two US senators called for the FTC to investigate TikTok after the disclosure about Chinese access to US data, according to Reuters.
• Chinese Capital Beijing will resume direct international flights in an orderly way, via Reuters.