Markets continue to search for direction

Markets, which have been squeezed by concerns about a second wave in the epidemic and developments regarding rapid economic recovery, have been having difficulty finding direction in recent days. While US stock markets closed the day with very small gains, the same picture also applies to US futures contracts this morning. There are also slight increases in Asian stock markets. While the MSCI index, which tracks Asia-Pacific stock markets, decreased by 0.06 percent, Chinese stocks rose 0.61 percent, led by gains in the financial and healthcare sectors. South Korea’s KOSPI index fell nearly 1 percent due to concerns about diplomatic tensions with North Korea.

The horizontal trend in the foreign exchange market in the country attracts attention. Dollar/TL 6.85; Euro/TL is valued at 7.69.

EU leaders to discuss rescue package

The eyes of the markets are turned to the European Union summit, which will start at 11:00 CET today. At the summit, EU leaders will try to end regional disputes to secure a 750 billion euro coronavirus recovery fund.

Fed balance sheet declined for the first time during the pandemic

Assets on the US Federal Reserve’s (Fed) balance sheet decreased this week for the first time since February. This reduction in the Fed’s assets reflected the sharp decline in currency swaps with foreign central banks and the ongoing slowdown in demand for emergency lending mechanisms.

The Fed’s balance sheet, which consists of assets ranging from U.S. Treasury bills and mortgage-backed securities to loans to banks and governments, fell to $7.14 trillion on June 17 from $7.22 trillion a week earlier.

IMF: US contraction may be deeper than expected in the second quarter

Pointing out that the closures in the USA due to coronavirus lasted longer than expected despite the withdrawal of some measures limiting mobility, the IMF reported that it is very likely that the US economy will experience a deeper contraction than expected in the second quarter. At a press conference held yesterday, IMF Foreign Affairs Director Gerry Rice pointed out that the pace of recovery in the US economy may be slow, considering that some businesses continue to be closed, but he did not give a figure.

Rice emphasized that detailed figures will be included in the IMF World Economic Outlook report, which will be updated on June 24. In its report published in April, the IMF predicted that the US economy would shrink by 5.9 percent in 2020 and grow by 4.7 percent in 20201.

Source: https://www.dunya.com/finans/haberler/piyasalar-yon-arayisini-surduruyor-haberi-473040

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