The meeting between President Donald Trump and Kim Jong-un was met with a collective shrug by global markets, which appear to be more fixated on a host of macro events and data due in a few days.
The S&P 500 Index rose slightly early on Tuesday, while the Dow Jones Industrial Average slipped and yields on 10-year Treasuries pushed closer to the 3 percent threshold. Safe-haven assets including the yen and gold edged lower as Trump and Kim signed a document pledging to work toward peace on the Korean peninsula.
There was never much prospect of the summit triggering a large market reaction, except perhaps in the event of a shock outcome. A seemingly certain Federal Reserve rate increase on Wednesday, plus the prospect of a hawkish European Central Bank tilt on Thursday, tease far more concrete developments for traders. Tuesday’s US inflation figures — which were in line with estimates — may even reignite the four-hikes-in-2018 debate ahead of the Fed’s decision.
“The world tour from Canada and to Singapore concluded with a photo-op, a handshake and little details on the how to achieve denuclearisation,” Mark McCormick, North American head of foreign-exchange strategy at Toronto-Dominion Bank, wrote to clients. “That leaves markets pivoting back to more predictable events like data and central bank decisions.”
The Stoxx Europe 600 Index opened higher, but pared its advance after modest gains for many Asian shares failed to ignite the MSCI Asia Pacific Index. The pound fluctuated before Theresa May’s Brexit legislation goes to Parliament, as data showed a surprise moderation in the pace of UK wage growth.
Elsewhere, West Texas oil hovered around $66 a barrel as a divide between OPEC nations over whether to ease production deepened.
British PM Theresa May faces votes that could derail her Brexit policy. The Federal Reserve is expected to raise interest rates on Wednesday as the US economy remains solid. The European Central Bank rates decision comes on Thursday with a briefing from President Mario Draghi. The Bank of Japan June monetary policy decision and news conference is Friday.
The S&P 500 Index rose less than 0.05 percent in New York. The Stoxx Europe 600 Index rose less than 0.05 percent. The UK’s FTSE 100 Index fell 0.2 percent. Germany’s DAX Index gained 0.1 percent to the highest in two weeks. The MSCI Emerging Market Index advanced 0.1 percent.
The Bloomberg Dollar Spot Index gained less than 0.05 percent. The euro increased 0.1 percent to $1.1792. The British pound fell 0.1 percent to $1.3364. The Japanese yen decreased 0.2 percent to 110.24 per dollar, the weakest in almost three weeks.
The yield on 10-year Treasuries increased one basis point to 2.97 percent. Germany’s 10-year yield gained one basis point to 0.50 percent, the highest in almost three weeks. Britain’s 10-year yield rose less than one basis point to 1.411 percent, the highest in almost three weeks.