Global

European Parliament Backs Compromise in Step towards U.S. Trade Deal. European lawmakers on Wednesday backed a compromise plan designed to spur negotiations on a trade pact between the European Union and the United States and overcome deep divisions within the European Parliament. Opposition to the proposed trade pact between the EU and the United States, which would be the world's biggest, has focused on its provision for private arbitration. European opponents say this would allow U.S. multinationals to challenge European food and environmental laws on the grounds they restrict commerce. (Reuters)

Malaysia

Bank Negara Expected to Hold Rates Today. Bank Negara Malaysia (BNM) is expected to keep its policy interest rate unchanged at a meeting on Thursday, holding a steady course amid market turbulence. Economists said the central bank may factor in risk to the economy from potential prolonged political uncertainty during its policy review, but for now the ringgit's volatility was an immediate concern. A poll of 15 economists was unanimous that BNM would keep its key interest rate at 3.25%. The last time the central bank changed its policy rate was a year ago, when it cut the rate by 25 basis points. (Reuters)

Asia

Japan May Core Machinery Orders Up 0.6% on Month. Japan's core machinery orders unexpectedly rose 0.6% in May from the previous month, up three months in a row, the Cabinet Office said on Thursday, in a sign that capital spending is steadily picking up. The rise in core orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, compared with economists' median estimate of a 5.0% month-on-month decline in a Reuters poll. Compared with a year earlier, core orders, which exclude those of ships and electric power utilities, rose 19.3% in May, versus a 16.3% gain expected by analysts. (Reuters)

Japan Current Account Surplus Widens. Japan posted a current account surplus for the 11th straight month in May as lower oil prices narrowed the trade deficit, suggesting companies have more leeway to increase investment as the costs to power their plants and factories drop. The current account surplus stood at 1.88 trillion yen ($15.36 billion), against a median forecast for a 1.54 trillion yen surplus, Ministry of Finance data showed on Wednesday. Wednesday's data showed imports tumbled an annual 10.3% in May as oil prices were down by almost half from the same period a year ago. Exports fell an annual 0.1%, the first decline in 27 months. (Reuters)

South Korea June Department Store Sales Drop at Fastest Clip in 5 Months. Annual sales at South Korea's department stores in June fell at their fastest pace in five months, as consumption was hurt by an outbreak of Middle East Respiratory Syndrome (MERS). Combined sales at department stores run by Hyundai Department Store, Lotte Shopping and Shinsegae Co fell 10.7% in June from a year earlier, the finance ministry said in a statement. This was the sharpest drop since an 11.0% fall in January and snapped two months of gains. Sales at major discount store chains fared no better, declining 9.7% on-year, and was also the biggest fall since January. (Reuters)

China Bans Big Shareholders from Cutting Stakes. China's securities regulator took the drastic step of ordering shareholders with stakes of more than 5% from selling shares for the next six months in a bid to halt a plunge in stock prices that is starting to roil global financial markets. The China Securities Regulatory Commission (CSRC) said on its website late on Wednesday that it would deal severely with any shareholders who violated the rule. Separately, major shareholders of top Chinese banks including ICBC and companies including Sinopec pledged to either maintain their holdings or increase their stakes in the listed companies.(Reuters)

Indonesia Gives Taxpayers with Small Incomes a Break. Indonesia's finance ministry, in a move it hopes will increase flagging consumption, has raised by nearly 50% the income threshold at which citizens start to owe income tax for 2015. Under a ministerial decree published on the ministry's website on Wednesday, the minimum income for unmarried adults to pay some tax has been raised to 36 million rupiah ($2,670) a year, up from 24.3 million rupiah previously. Finance Minister Bambang Brodjonegoro has said the move was aimed at increasing people's purchasing power and helping revive economic growth. (Reuters)

USA

Consumer Borrowing Hits Record High in May. U.S. consumer borrowing climbed to a record high in May, propelled by a surge in auto and student loans. Consumer borrowing increased $16.1 billion following a gain of $21.4 billion in April, the Federal Reserve reported Wednesday. The April increase had been the strongest monthly increase since July 2014. The gains pushed total borrowing to a fresh record of $3.4 trillion. The overall increase put total credit up 6.5% over the past 12 months. The rise is led by a 7.8% jump in borrowing in the auto and student loan category and a more moderate 3.2% rise in borrowing in credit cards. (AP)

More Data Needed Before Fed Can Hike. Federal Reserve officials needed to see more signs of a strengthening U.S. economy before raising interest rates, according to minutes of a June Fed policy meeting, at which Greece's debt crisis was cited as a serious concern. The minutes from the June 16-17 meeting show how the central bank continues to grapple with its plan to raise interest rates later this year, in the wake of mixed economic data domestically and market turmoil gathering steam abroad. The minutes underscored the view that a Fed rate hike would likely have to wait until at least September. (Reuters)

Europe

France Trims Q2 Growth Estimate to 0.2%. The Bank of France revised down its estimate for second quarter growth in the French economy to 0.2% Wednesday, releasing a survey that gave a mixed outlook for the industrial and services sectors. A previous June 8 forecast put second-quarter growth at 0.3%. The central bank's business sentiment indicator for the manufacturing industry fell to 98 in June after 99 in May, while the same indicator in the services sector rose to 96 from 95. In its commentary, the bank said business leaders expected industrial production and services activity to rise in July, with construction activity seen stable. (Reuters)

UK’s Osborne Cuts Welfare, Boosts Minimum Pay in Post-Election Budget. British finance minister George Osborne said he would reshape the world's fifth-largest economy by chopping welfare but also announced a new national minimum wage in a budget that reflects an unexpectedly decisive election victory. Osborne also announced that it would now take four years, not three, to achieve his aim of turning Britain's hefty budget deficit into surplus. Seeking to counter the impact of his plan to save 12 billion pounds ($18 billion) in annual welfare spending, equivalent to about 11% of the non-pension welfare budget, Osborne announced a new higher minimum wage for those aged 25 or over. (Reuters)

Currencies

Yen Climbs to 7-Week Peak Against Dollar on Greece, China Turmoil. The yen climbed to a seven-week peak against the dollar on Wednesday, as investors piled into the Japanese currency's safety, spooked by plunging Chinese stocks and the still unresolved Greek debt crisis. The dollar fell to its lowest level since May 22 at 121.03 yen. It was last at 121.07 yen, down 1.2%. The euro also dropped against the yen, down 0.8% versus at 133.77 yen. The low-yielding yen, used as a funding currency to buy other higher-yielding assets in so-called "carry trades," typically rallies in times of economic and financial stress as investors unwind these transactions. (Reuters)

Ringgit Volatility Gauge Advances as Bonds Fall. A gauge of volatility in Malaysia’s ringgit rose to a two-month high and government bonds dropped amid a probe involving finances linked to a state investment company. One-month implied volatility, a measure of expected moves in the exchange rate used to price options, climbed six basis points to 10.88% as of 5:15 p.m. in Kuala Lumpur. It earlier rose to 10.98%, the highest since May 8. (Bloomberg)

Commodities

U.S. Crude Falls More Than 1% on Surprise Stockpile Build. U.S. crude futures fell more than 1% on Wednesday after a surprise build in stockpiles while gasoline rallied on bets for strong fuel demand through the peak summer driving season. The U.S. Energy Information Administration said inventories rose last week for crude, gasoline and distillates. That surprised market players a day after industry group the American Petroleum Institute had reported a draw of 1 million barrels. The front-month contract for US crude settled down 68 cents, or 1.3%, at $51.65 a barrel. It had fallen on Tuesday to $50.58, its lowest since April 8. Brent settled up 20 cents, or 0.4%, at $57.05, bucking the trend in U.S. crude for a second straight day. (Reuters)

Gold Above 4-month Lows, Platinum Nears $1,000/oz on China Worries. Gold edged up on Wednesday as the dollar softened yet prices remained close to a four-month low hit earlier in the session as markets watched the tumble in Chinese stock markets and the unfolding Greek debt crisis. Spot gold was up 0.2% at $1,157.22 an ounce as of 1144 GMT, not far above an earlier level of $1,146.75, its lowest since March 18. It fell more than 1% on Tuesday. Other precious metals logged sharp losses, with platinum approaching the $1,000 an ounce mark for the first time in more than six years. Silver was up 0.1% at $15.05, after a 4.4% tumble in the previous session, when it touched its lowest since December 2014. Palladium fell 3% to mid-2013 lows of $627.72 an ounce. (Reuters)