On Tuesday, US stocks were closed for the Independence Day holiday. European stocks traded lightly, with the pan-European stock index rebounding led by real estate stocks. However, domestic stock indexes in major eurozone economies such as Germany all fell, reflecting the increasing risk of economic slowdown as reflected in June's PMI and other economic data from Europe and the United States. Meanwhile, central banks in Europe and the United States continue to signal interest rate hikes, further dampening market sentiment due to increased uncertainty about the outlook.
In the commodity market, international crude oil rebounded as Saudi Arabia and Russia, the two major oil-producing countries in OPEC+, announced new actions to limit supply, supporting higher oil prices. Algeria in Africa also plans to slightly reduce production. Saudi Arabia will extend the voluntary additional production cut of 1 million barrels per day, which started in July, for another month until August. Russian Deputy Prime Minister Novak stated that Russia will reduce oil exports by 500,000 barrels per day in August. Algeria plans to reduce production by 20,000 barrels per day in August.
Analysts estimate that if the production cuts by the three countries mentioned above are fully implemented, OPEC+ will reduce its oil production by 5.36 million barrels per day compared to the same period in August last year. Considering that many OPEC+ member countries are unable to meet their respective oil production quotas, the scale of production cuts may be even larger. In addition, the futures curve for crude oil is sending a more bullish signal. On Monday, the spread between near-term and future oil prices reached its highest level in about a month, reflecting market expectations of tight supply.
Industry insiders believe that Saudi Arabia is clearly taking proactive action to stabilize oil prices and hopes to raise them to $80 per barrel in order to maintain its domestic fiscal budget. However, the market is still waiting to confirm Russia's new production cuts and is concerned that further interest rate hikes by central banks will drag down global demand.
<h2>European real estate stocks rise 2.8%, Swedish SBB up nearly 16%, major eurozone economies' stock indexes fall together</h2>
The pan-European stock index, which had stopped its four-day rally, rebounded slightly. The STOXX Europe 600 index closed up less than 0.1%. After falling more than 0.2% on Monday, it began to approach the closing high since June 21 set last Friday. Major European country stock indexes fell together on Tuesday, with German, French, and British stocks falling for two consecutive days, the Italian stock index falling from its highest level since 2008 for two consecutive days, and the Spanish stock index ending its six-day rally.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/89b3ff9b-8603-4c13-bba8-c803c0cf6915.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/89b3ff9b-8603-4c13-bba8-c803c0cf6915.png"/>
Among the various sectors of the STOXX Europe 600, real estate stocks led the gains, rising by about 2.8%. They have risen by about 6% in the past three trading days, marking the largest three-day gain in more than three months. The healthcare sector, which fell more than 2% on Monday due to Astrazeneca's drag, rebounded and closed up about 0.5%. The technology sector also rose by about 0.5%, while banks fell by 0.6%, automobiles fell by over 0.5%, engineering fell by about 0.4%, and industry fell by 0.3%.
In the real estate sector, Swedish commercial real estate giant Samhallsbyggnadsbolaget i Norden AB (SBB) announced on Tuesday that it will sell all its shares in fellow company Heba Fastighets AB, which is the latest move by SBB to raise funds and strengthen its balance sheet. SBB closed up about 15.9%, becoming the biggest driver of the rise in the real estate sector, while Heba Fastighets AB rose by about 6%.
In addition, after being recommended for purchase by DNB Bank ASA of Norway due to attractive valuation, the leading Swedish real estate company Castellum AB rose by about 5.7%.
Among other stocks with significant fluctuations, Warehouses de Pauw CVA, a Belgian warehouse operator that raised its profit guidance, rose by 3.8%; OMV AG, an Austrian company, surged by 7.4% after media reports of discussions with Abu Dhabi to establish a chemical and plastics company worth over $30 billion; and Casino Guichard-Perrachon SA, a French retailer undergoing restructuring and facing a proposed increase in equity investment by Czech billionaire Daniel Kretinsky, initially rose by over 21.6% in early trading, temporarily halting trading before closing with a 16.2% increase.
Furthermore, AstraZeneca's European stocks listed in London rose by 2.4%. After announcing preliminary results of a phase III clinical trial for lung cancer treatment that fell short of expectations on Monday, the company's European stocks fell by 8%, marking the largest decline since March 2020.
<h2>2-Year UK Bond Yield Drops from Highs Since 2008</h2>
European government bond prices did not continue to fall, and the yields of UK and German short-term bonds retreated.
At the end of the bond market session, the yield on the UK 10-year benchmark government bond closed at 4.41%, down 2 basis points during the day, failing to approach the high since October last year that was refreshed on June 20; the yield on the 2-year UK bond closed at 5.28%, down 2 basis points during the day, moving away from the high of 5.40% breached on Monday and continuously refreshed since 2008.
The yield on the 10-year benchmark German government bond closed at 2.45%, up 2 basis points during the day, briefly surpassing 2.48% during the session, reaching a high since June 23; the yield on the 2-year German bond closed at 3.20%, down 3 basis points during the day, but it briefly exceeded 3.30% during the European stock market session, reaching a high point in nearly four months.
<h2>Yen Rebounds During the Session, Off Seven-Month Lows; Offshore Renminbi Rises Over 300 Points</h2>
The ICE Dollar Index (DXY), which tracks the exchange rates of the US dollar against six major currencies including the euro, experienced slight fluctuations on Tuesday, alternating between gains and losses. After a slight rise in the Asian market session, it approached 103.10, a new daily high, before rising by 0.1% during the day. It fluctuated between gains and losses during the European stock market session, and in the usual early trading session of the US stock market, it briefly fell below 102.90, a new daily low, before declining by 0.1% during the day. In the usual midday trading session of the US stock market, it rebounded but failed to approach the high since June 13 that was breached on Friday, when it rose above 103.50.
At the close of the US stock market, the US dollar index was between 103.00 and 103.10, with a daily increase of less than 0.1% for two consecutive days. The Bloomberg Dollar Spot Index, which tracks the US dollar against ten other currencies, fell by less than 0.1% and experienced a second consecutive day of decline after a slight decline on Monday.
The Japanese yen rebounded on Monday after returning to a downward trend, marking its second day of gains in the past six trading days. The USD/JPY pair rose above 144.70 in early Asian trading, hitting a new daily high. However, it retreated during the European stock market opening and briefly tested the 144.20 support level, down 0.3% for the day. Compared to last Friday's peak above 145.00, it dropped by about 0.6%, marking a decline of approximately 0.6% from the highest level since November last year. At the end of the US stock market session, it was trading around the 144.40 level.
The EUR/USD pair fell below 1.0890 during the European stock market session, down 0.2% for the day, approaching the intraday low set on June 15, which was also below 1.0840. The GBP/USD pair, which rebounded during Monday's session, maintained its overall upward momentum during Tuesday's European and American trading sessions. It approached 1.2740 during the European stock market session, up nearly 0.4% for the day, moving away from the two-week low reached after falling below 1.2600 last Thursday.
The offshore Chinese yuan (CNH) hit a daily low of 7.2565 in early Asian trading, but quickly rebounded. During the early US stock market session, it reached a daily high of 7.2181, up 348 pips for the day. Compared to last Friday's low of 7.2857, it rebounded by 676 pips from the intraday low, the lowest level since November 4 last year. At 4:59 am Beijing time on July 5, the offshore yuan against the US dollar was quoted at 7.2279 yuan, up 250 pips from the New York closing on Monday, marking a three-day consecutive increase.
Cryptocurrencies failed to sustain the rebound seen on Monday. Bitcoin (BTC) rose above $31,300 in early Asian trading, approaching its one-year high, but then retreated. It fell below $30,600 during the midday US stock market session, down about $700 or more than 2% from the intraday high. At the close of the US stock market, it was trading above $30,700, down more than 1% in the past 24 hours.
<h2>Crude Oil Rebounds, Brent Crude Hits Two-Week High</h2>
International crude oil futures continued to rebound on Tuesday, erasing the losses from the previous three consecutive days. US WTI crude oil remained above $70 for most of the day. It reached a daily high of $71.36 during the early US stock market session, up more than 2.2% for the day. Brent crude oil rose to $76.29, up about 2.2% for the day.
At the close, Brent September crude oil futures rose $1.60, or 2.14%, to $76.25 per barrel, setting a new closing high since June 21. There was no closing price for US crude oil on Tuesday, which was the Independence Day holiday. If the upward momentum continues on Wednesday, it will set a new high since June 21, following last Friday's record.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/6259572f-4f38-49ba-a7a5-482bd5e0b040.jpeg?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="Crude Oil" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/6259572f-4f38-49ba-a7a5-482bd5e0b040.jpeg"/>
European natural gas rebounded after falling more than 8% on Monday. UK natural gas futures rose by about 3.7%, reaching 86.78 pence per therm, approaching the high set on June 21, which was also the highest level in two consecutive days since last Friday.
European TTF benchmark Dutch natural gas futures on the continent rose by about 4.4%, reaching 35.41 euros per megawatt-hour, approaching the high closing level since June 20 when it broke through 37 euros.
<h2>Gold continues to rise, London copper falls from one-week high, London zinc rises nearly 2%</h2>
New York gold futures had no closing quotes on Tuesday, the Independence Day holiday, but maintained an upward trend after rising during the Asian session. When European stocks hit a daily high, COMEX August gold futures rose to $1938.1, up more than 0.4% intraday. If this upward trend continues until the close on Wednesday, it will mark the third consecutive trading day of gains, not only moving away from the low closing level of $1918 reached last Thursday, the lowest since March 14, but also possibly setting a new high since June 21.
London base metal futures showed mixed movements on Tuesday. London tin fell from the high reached in late April after three consecutive days of gains. London copper bid farewell to the high reached in late June after two consecutive days of gains. London nickel, which rebounded on Monday, also fell back and failed to continue the upward trend from the low reached last Wednesday, the lowest since July last year. On the other hand, London zinc, which fell on Monday, rose nearly 2% and rebounded to a high level in over a week. London aluminum continued its two-day rally, further moving away from the low reached at the end of September last year. London lead rebounded slightly but did not approach the three-week low reached last Thursday.
China announced on Monday that it will implement export controls on two emerging strategic critical minerals, gallium and germanium, starting from August. Gallium is usually associated with bauxite, lead-zinc ore, and other minerals, while China's germanium resources mainly come from lead-zinc and coal-type germanium-bearing deposits.

European stock indices rebounded slightly, with the real estate sector rising 2.8% and Swedish commercial real estate giant SBB surging nearly 16%. However, stock indices of major eurozone economies such as Germany fell across the board, and Italian stocks fell from their highest level since 2008. Saudi Arabia and Russia announced measures to limit supply, supporting a rebound in crude oil prices, with Brent crude reaching a two-week high. Gold continued to rise. London copper fell from its highest level in over a week, while London zinc rose nearly 2%, reaching a high not seen in over a week. The Japanese yen rebounded during the session, failing to approach its seven-month low; offshore renminbi rose more than 300 points during the session.

Wallstreetcn

Pro Shrt S-Cp 600

US stocks closed for the day, real estate stocks supported European stocks rebounded, Saudi Arabia and Russia exerted efforts, and crude oil rose more than 2%.