[Platinum Insights] (6.7.23)

Good morning  

U.S. stock index futures edged lower on Wednesday as investors remained cautious ahead of inflation data and the Federal Reserve’s policy meeting next week.  

Inflation data in the U.S. is expected to show consumer prices cooled slightly on a month-over-month basis in May but core prices are likely to have remained elevated, and the Fed is widely expected to hold interest rates.  

China’s May exports slumped 7.5% year-on-year, much larger than the forecast 0.4% fall and the biggest decline since January, raising concerns over global demand.  

Mortgage applications in the US fell 1.4% in the week ended June 2nd, 2023, extending the decline for a fourth week and pushing the Mortgage Market Index to a fresh three-month low, data from the Mortgage Bankers Association data showed.  

WTI crude futures steadied just above $72 per barrel. Gold was subdued around $1,960 an ounce while the yield on the US 10-year Treasury note reversed early gains to trade around 3.7%.  

“Nasdaq is more than 40% up from its October lows, not posting a decent correction since mid-March. Therefore, the risks of a corrective setback seem to be increasing, especially with a potential liquidity squeeze from Treasury issuance looming,” said Charalampos Pissouros, senior investment analyst at XM.  

DoubleLine Capital CEO Jeffrey Gundlach reportedly said on Tuesday it looks increasingly possible the United States will tip into a recession. Gundlach also highlighted his preferred portfolio mix right now consists of 30% stocks, 60% bonds and 10% real assets. In terms of real assets, the investor said he favors gold, even though he’s now less bullish compared to earlier times.  

A light period for economic data continues ahead of next week’s Federal Reserve policy meeting, with trade balance data due out before the bell Wednesday.   

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