US ISM non-manufacturing data also boosted spirits in the previous session. The ISM index shot up to 57.1 in June, well ahead of the 50 level forecast and a significant improvement on the 45.5 recorded in the previous month. The rebound in the US’s dominant service sector boosted optimism that a V-shaped recovery was still a possibility. This does of course depend of the ability of authorities in the US to bring coronavirus numbers under control.
The RBA held interest rates at 0.25% as expected, as soaring job advertisements and retail sales indicate that the economy is recovering. RBA Governor Dr Philip Lowe declared that the worse of the global contraction is over. However, fears of spiralling cases in Australia’s second largest city highlights the struggles that lie ahead. News that Victoria and New South Wales, the nations most populous and economically powerful states will be closing their borders and that Melbourne will be going into lock down for 6 weeks, dragged the Australian Dollar off RBA inspired highs.
Big names reporting
There is little on the UK economic calendar to keep traders entertained, but this is more than made for by a slew of companies reporting including JD Sports, Halfords and Whitbread. Boohoo is also expected to remain under the spotlight after diving 23% in the previous session on accusations of slave labour, human trafficking and unsafe working practices in sweat shops during the coronavirus crisis.
Attention will also turn to Rishi Sunak who, tomorrow is expected to announce a relief package to fight the coronavirus crisis in a mini-Budget.