Asia 

China Industrial Profits Jump in May, Beat Forecast. China's industrial profits unexpectedly jumped 15.5 % in May from the same month last year, the National Bureau of Statistics said on Thursday, beating consensus forecasts. Industrial firms in China generated profits of 470.6 billion yuan ($76.1 billion) in the month, bringing total profits from January-May to 2.08 trillion yuan, up 12.3 % from the year-ago period. The rise in May was substantially higher than the previous April's year on year rise of 9.3 %, and much better than analyst expectations of 7-8 %. (CNBC)

India’s Current Account Deficit Narrows; Rupee Rebounds.  India released figures showing a narrower-than-estimated currentaccount deficit a day earlier than expected, sparking a climb in the rupee from a record low.The shortfall was $18.1 billion in January through March, compared with a revised $31.9 billion in the previous quarter, the Reserve Bank of India said today. The median of 14 estimates in a Bloomberg News survey was for a $21 billion gap. The deficit last quarter was 3.6 % of gross domestic product, from an unprecedented 6.7 % of GDP in October to December. (Bloomberg)

Vietnam Economic Growth Quickens As Investment Aids Exports. Vietnam’s economic growth accelerated in the second quarter after the central bank cut interest rates to revive lending to businesses and rising foreign investment boosted the nation’s exports. Gross domestic product grew 5 % in the second quarter from a year earlier, according to the General Statistics Office in Hanoi. The central bank said today it would weaken its dong-dollar reference rate and that it would lower its rate caps on U.S. dollar and dong deposits effective June 28. The legislature last week voted to lower the corporate income tax rate to help businesses, while disbursed foreign investment rose 5.6 % in the first half of 2013 to $5.7 billion, according to the Ministry of Planning & Investment. (Bloomberg)

USA

Federal Reserve Officials Clarify 'Tapering'. Officials at the Federal Reserve have tried to calm investors by emphasising that bond purchases will not halt until the economy strengthens. The comments are the strongest signals yet by monetary officials following recent market turmoil. Markets were rattled after chairman Ben Bernanke indicated last week that the Fed would start scaling back its extraordinary support of the economy. A survey on Thursday showed a sharp rise in mortgage rates this week. (BBC)

Fed Officials Step Up Campaign To Stem Increase In Rates. Federal Reserve officials stepped up their campaign to stem an increase in long-term borrowing costs that threatens to blunt the U.S. expansion and sought to clarify comments by Chairman Ben S. Bernanke that sparked turmoil in global financial markets. Concerns the Fed may curtail accommodation helped push the yield on the 10-year Treasury note as high as 2.61 % this week from as low as 1.63 % in May. (Bloomberg)

Consumer Spending In U.S. Rebounds As Incomes Increase. Consumer spending in the U.S. rebounded in May following the largest drop in more than three years, a sign the economy can weather a second-quarter slowdown. Household purchases rose 0.3 % after a 0.3 % decline the prior month that was the biggest since September 2009, according to Commerce Department data issued today in Washington. Other reports showed the housing recovery is gaining momentum and consumers are becoming more confident. (Bloomberg)

Jobless Claims In U.S. Declined 9,000 Last Week To 346,000.  Fewer Americans filed claims for unemployment benefits last week, indicating employers are slowing the pace of firings as the economic outlook improves. Jobless claims decreased by 9,000 to 346,000 in the week ended June 22 from a revised 355,000 the prior period, the Labor Department reported today in Washington. The median estimate in a Bloomberg survey of economists called for 345,000 claims. Smaller reductions in headcounts indicate employers are confident enough that demand will be  sustained as the housing market improves and consumers grow more optimistic. (Bloomberg)

Europe

EU Reaches Political Deal On Seven-Year Budget. A political deal on the EU's hotly contested seven-year budget has been struck, European Commission President Jose Manuel Barroso has announced. The deal on the 2014-2020 budget was reached between member states and European Parliament leaders, he said. The 960bn-euro (£822bn; $1.3tn) budget cuts real spending for the first time. Speaking in Brussels as EU leaders gathered for a summit, Mr Barroso said the deal would speed up spending on youth employment. Nearly a quarter of people aged 18 to 25 in the EU have no job, while in Greece and Spain it is more than half. (BBC)

European Economic Confidence Improves More Than Forecast.  Economic confidence in the euro area improved more  than economists forecast in June, adding to indications the 17-nation economy is starting to recover from the longest recession since the debut of the common currency. An index of executive and consumer sentiment rose to 91.3 from 89.5 in May, the biggest jump since July 2010, the European Commission in Brussels said today. The June reading, the highest in 13 months, was above the 90.4 median projection by economists in a Bloomberg News survey. (Bloomberg)

French Consumer Confidence at All-Time Low, Outlook Bleak.  Morale among French consumers is at an all-time low and they are more pessimistic than ever about their future living standards, data showed on Thursday, adding further to the gloom as France battles with unemployment. The figures showed the euro zone's second-largest economy, hit by lagging trade competitiveness and a caught in a shallow recession, will not be able to count on its traditional driver - consumer spending - to rebound. The sickly growth will leave France's 2013 public deficit near 4 % of economic output, overshooting an already revised target of 3.7 % and further awa from an EU goal of 3 %, the state auditor said in a report on Thursday. Consumer confidence, which came in three points below analyst expectations of 81 and far below a long term average of 100, was the lowest since records began in 1972,data from statistics office INSEE showed. (Reuters)

UK Double-Dip Recession Revised Away. The UK economy did not experience a double-dip recession at the beginning of 2012, official figures have shown. Updating its historical data, the Office for National Statistics (ONS) said growth was flat in the first quarter of 2012, revised from an earlier estimate of a 0.1% contraction. This means the economy did not contract for two quarters in a row - the definition of a recession. But the ONS said the recession in 2008 was deeper than previously estimated. Gross domestic product (GDP) during that time is now estimated to have dropped by 7.2% from peak to trough, against a 6.3% fall previously recorded. That means that GDP in the first quarter of 2013 was 3.9% lower than its peak in the first quarter of 2008 -  previously it was estimated to be 2.6% below. (BBC)

U.K. Plans To Sell $23 Billion State Assets To Cut Debt. The U.K. government announced it will sell off 15 billion pounds ($23 billion) of state-owned assets by 2020 to help bring down its debt, as it detailed future spending on infrastructure to boost growth. Chief Secretary to the Treasury Danny Alexander said 10 billion pounds would be generated by selling corporate and financial assets such as the mortgage-style student loan book, along with 5 billion pounds of land and property. He pledged 300 billion pounds of capital spending by the end of the decade, highlighting the construction of the high-speed rail link from London to northern England. (Bloomberg)

Russia Scales Down Asset Sales As Medvedev Bemonas Delays. Russia will raise a third less than previously estimated from asset sales in the next three years, downsizing the program as Prime Minister Dmitry Medvedev criticized the lobbying that’s putting a brake on plans. Revenue from asset sales will bring the budget about 630 billion rubles ($19 billion) in the next three years, including about 180 billion rubles in 2014, Economy Minister Alexei Ulyukayev said at a government meeting today. That compares with a planned 925.9 billion rubles written into the three-year budget, according to the Economy Ministry. (Bloomberg)

Currencies

Dollar Could Extend Longest Win Streak In A Year.  The U.S. dollar rose against most of its major rivals on Thursday as Federal Reserve officials said the rise in interest rates was at odds with the central bank’s policy. The dollar on Thursday traded at 98.35 Japanese yen, higher than Wednesday’s level at ¥97.77. The British pound fell to $1.5259 from $1.5314. The ICE dollar index, which measures the U.S. unit against six other major currencies, has been swinging to slight gains and losses all day. The index fell slightly to 82.901 in recent trade compared with 82.964 late Wednesday, when the index notched its sixth consecutive win. That marked the longest streak since May 2012, according to FactSet data. The euro rose to $1.3044 from $1.3004 late Wednesday. The European currency on Wednesday traded at a more than a three-week low, under $1.30. The Australian dollar was little changed at 92.76 U.S. cents recently, compared to 92.74 U.S. cents on Wednesday. (MarketWatch)

Commodities

UK Shale Gas Resources 'Greater Than Thought'. UK shale gas resources may be far greater than previously thought, a report for the government says. The British Geological Survey estimates there may be 1,300 trillion cubic feet of shale gas present in the north of England - double previous estimates. Meanwhile the government has announced measures to enable shale gas drilling as part of its infrastructure plans. Drilling companies have previously estimated that they may be able to extract around 10% of this gas - equivalent to around 130 trillion cubic feet. (BBC)

Oil Rises Amid Talk Fed Will Continue Stimulus For Now. Crude oil futures rose for a fourth straight session on Thursday, gaining over $1 a barrel, as conviction strengthened that monetary stimulus measures from major central banks would stay in place for the time being. Brent crude for August delivery tested its 50-day moving average, rising as high as $103.34 before ending the day up $1.16 at $102.82 a barrel. Brent is on track for its longest stretch of daily gains since mid-May. U.S. crude rose for a fourth straight session, breaking through its 14-day moving average to end up $1.55 at $97.05 a barrel. (Reuters)

Gold Sinks Below $1,200 For First Time In Nearly 3 Years. Gold sank 2 % on Thursday, as month-end book squaring and relentless liquidation by institutional investors sent bullion prices below $1,200 per ounce for the first time in nearly three years. Spot gold was down 2.1 % to $1,199.51 an ounce by 4:07 p.m. EDT (2001 GMT). Its session low of $1,197.1 an ounce was its lowest since Aug 12 2010. Among other precious metals, silver edged up 0.1 % to $18.48 an ounce, a day after it sank 5.5 %. Platinum rose 0.9 % to $1,313 an ounce and palladium was up 2.4 % to $644.47 an ounce. (Reuters)

Source: Kenanga