FED: St Louis's Musalem Says Labor Market "Looks Good"

• Stocks are trading firmer early Wednesday, apparently tracking a rebound in Treasuries off yesterday's June 20 lows, projected rate cuts into year end gaining slightly ahead of this afternoon's June FOMC minutes release.
• Indexes did pare gains by midmorning, likely profit taking ahead of the minutes and some amount of wariness amid Pres Trump reiterating tariff threats via social media. Currently, the DJIA trades up 69.23 points (0.16%) at 44322.34, S&P E-Minis up 16.75 points (0.27%) at 6290.25, Nasdaq up 119 points (0.6%) at 20542.14.
• Communication Services and Information Technology sectors led gainers in the first half, interactive media and entertainment shares buoyed the former with Alphabet +2.80%, Warner Bros Discovery +2.59%, Meta Platforms +2.16% and Paramount Global +0.83%.
• THe Tech sector was supported by Arista Networks +2.20%, NVIDIA +2.10% (fist company to reach $4T market cap), Broadcom +1.76%, Microsoft +1.66% and Advanced Micro Devices +1.60%.
• On the flipside, Consumer Staples and Energy sectors underperformed in the first half, The Hershey Co -3.41%, Altria Group -2.66%, Monster Beverage -1.93% and Archer-Daniels-Midland -1.15% weighed on Staples while EQT Corp -1.59%, Targa Resources -1.53%, EOG Resources -1.43% and Kinder Morgan -1.39% kept the Energy sector under wraps.

Little in the way of obvious drivers for the pullback from highs in e-minis.

• President Trump reiterated tariff threats against countries aligning themselves with “anti-American” BRICS policies via social media, but this wasn’t new information.
• Initial resistance in the S&P 500 e-mini (July 3 high 6,333.25) remains untested.

• A relatively subdued session for the greenback has allowed NZDUSD to consolidate its most recent pull lower, after printing a fresh pullback low below 0.5980 overnight. The pair continues to exert pressure on the 50-day EMA, of which spot has not closed below since April 09. Continued weakness would signal scope for a move towards 0.5883 and 0.5847 (double bottom seen in mid-May and an important pivot level).
• AUDNZD has also extended its recovery to a seven-week high above 1.0900. Trendline support drawn from the April lows has helped underpin the latest bounce for the cross, targeting 1.0922 (May 15 high) initially, before the early April highs just above 1.10.
• As a reminder, the RBNZ held the Official Cash Rate steady at 3.25% on Wednesday as expected, but signalled further cuts may follow if medium-term inflation continues to ease in line with forecasts.
• The decision followed signs of a patchy domestic recovery, as high-frequency data from April and May suggest growth momentum has been slowing. Additionally, the committee weighed the option of a 25bp cut, citing subdued growth and the risk that heightened uncertainty may lead to sustained caution among households and firms.