ECB rate hike signal raised investors’ concerns ahead of US CPI data. ECB will end quantitative easing on July 1, raise interest rates by 25 bps at the end of July, and
potentially be more aggressive in September. Meanwhile, large capitalization growth stocks hit Wall Street again, with the Nasdaq down 2.75%. Investors are looking
forward to the Fed’s response, as the US May CPI is projected to be 8.3% YoY, or very far from the 2% target. This has the potential to make the Fed more Hawkish in
September, after the June and July FFRs which are projected to rise by 50 bps each.

Optimistic CCI and China’s trade surplus supported the JCI to be in the Green Zone all day, before finally closing down 10 points below the 7,200 level. The BI CCI for May rose significantly to 128.9 (Vs. Apr. 113.1), as people’s mobility will drive economic recovery. Meanwhile, China recorded a trade surplus of USD 78.7 billion in May, driven by exports growing up to 16.9% YoY (Vs. Apr. 3.9% YoY), but with imports only rising 4.1% YoY. Negative sentiment signaling an increase in ECB interest rates, and projections of high US inflation, have made NHKSI Research project that the JCI will move downward in the range of 7,100-7,300.

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