North American Morning Briefing : Stock Futures -2-

July 05, 2022 at 05:55 am EDT

People familiar with the situation say what comes next has been pending with Mr. Biden in recent weeks and that he could announce his decision this week. It could include a pause on tariffs on consumer goods such as clothing and school supplies, as well as launching a broad framework to allow importers to request tariff waivers.

Chinese Vice Premier Liu, Treasury Secretary Yellen Discuss Economic Issues, Xinhua Reports

Chinese Vice Premier Liu He held a video call Tuesday with U.S. Treasury Secretary Janet Yellen and exchanged views on economic issues, state-run Xinhua News Agency reported.

The two discussed matters including the macroeconomic situation and global industrial and supply chains, said Xinhua, characterizing the talks as "constructive."

Australia's RBA Delivers Another Big Rate Increase

SYDNEY-The Reserve Bank of Australia delivered its second consecutive 50-basis-point interest-rate rise at a policy meeting Tuesday, noting that inflation risks remain high and that further action to rein in prices is likely in the coming months.

RBA Gov. Philip Lowe announced a rise in the official cash rate to 1.35% from 0.85%, adding to June's 50-basis-point hike and a 25-basis-point increase in May.

China Service Sector Activity Rebounded in June

China's Caixin services purchasing managers index, a private gauge, rebounded in June as Covid-19 restrictions were eased in the world's second-largest economy.

The Caixin services PMI rose to 54.5 in June from 41.1 in May, Caixin Media Co. and research company S&P Global said Tuesday. That marked the quickest expansion recorded since July 2021.

China Imposes Fresh Restrictions as Covid-19 Cases Rise

China is imposing fresh restrictions in some eastern cities as Covid-19 cases have spiked to near their highest levels in more than a month.

The country recorded 380 locally transmitted coronavirus cases on Sunday, China's National Health Commission reported on Monday. Two thirds of Monday's cases came from the eastern province of Anhui, the commission said.

U.S.-Stock Funds Fell 16.3% in Second-Quarter Rout

Keep repeating to yourself: Don't panic about short-term declines.

Easier said than done this time. Bruising inflation and rising interest rates bowled over markets in the second quarter-and fund investors weren't spared. The average U.S.-stock fund fell 16.3% in the quarter, according to Refinitiv Lipper data. The average fund is down 21.3% for the year to date. Only a handful of stock-fund managers have managed to stay in positive territory (see Winners' Circle).

Falling Commodity Prices Raise Hopes That Inflation Has Peaked

A slide in all manner of raw-materials prices-corn, wheat, copper and more-is stirring hopes that a significant source of inflationary pressure might be starting to ease.

Natural-gas prices shot up more than 60% before falling back to close the quarter 3.9% lower. U.S. crude slipped from highs above $120 a barrel to end around $106. Wheat, corn and soybeans all wound up cheaper than they were at the end of March. Cotton unraveled, losing more than a third of its price since early May. Benchmark prices for building materials copper and lumber dropped 22% and 31%, respectively, while a basket of industrial metals that trade in London had its worst quarter since the 2008 financial crisis.

Biden Says U.S. Can Choose Unity as Nation Faces Divisions

WASHINGTON-President Biden said in a Fourth of July address that many Americans are worried about the divisions roiling the country but the U.S. has the power to choose a "unity of purpose."

Mr. Biden, speaking to military families at a barbecue on the South Lawn of the White House, noted Monday's deadly shooting at a parade in the Chicago suburb of Highland Park, Ill.

Highland Park July Fourth Parade Shooting Leaves at Least Six Dead; Police Apprehend Person of Interest

HIGHLAND PARK, Ill.-Police late Monday apprehended a person of interest in a shooting at a July Fourth parade in this Chicago suburb that left at least six people dead and more than two dozen wounded.

Robert E. Crimo III, a 22-year-old from Highland Park, was caught in a car in the nearby town of Lake Forest following a brief pursuit, after he was spotted by an officer, according to local law enforcement.

Ukraine's Allies Talk of Rebuilding as Russia Consolidates Gains in Donbas

Ukraine's President Volodymyr Zelensky said huge investments would be needed to rebuild the country, addressing Western officials in Switzerland as Russian forces continued to press their advance in the east.

Mr. Zelensky spoke during a conference Monday via video-link to discuss a road map for Ukraine's reconstruction, after Russian forces gained control Sunday over the eastern city of Lysychansk.

Akron Declares State of Emergency Following Police Shooting of Jayland Walker

The mayor of Akron, Ohio, declared a state of emergency on Monday and issued a curfew starting at 9 p.m. after protesters damaged property amid protests over the fatal police shooting of a 25-year-old Black man.

The protests came after the release on Sunday of body-camera videos that appear to show multiple police officers firing dozens of times at Jayland Walker, who was unarmed, the morning of June 27. Akron Police Chief Stephen Mylett said a lot of rounds were fired and investigators are trying to determine exactly how many.

Jan. 6 Hearings to Examine Role Extremist Groups, White House Played in Capitol Attack

WASHINGTON-The House select committee investigating the Jan. 6, 2021, attack on the U.S. Capitol is expected to zero in on two overlapping areas of its probe in coming hearings: the extremist groups that participated in the attack and a minute-by-minute account of what took place inside the White House that day.

The committee in its previous hearings has largely focused on efforts by former President Donald Trump and his allies to overturn the 2020 presidential election by pressuring then-Vice President Mike Pence, senior officials in the Justice Department and state officials to take actions that would reverse the results.

Write to nihad.ahmed@wsj.com TODAY IN CANADA

Earnings:

None scheduled

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Economic Indicators (ET):

0830 Jun Preliminary estimates of principal field crop areas

0830 May Building permits

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Stocks to Watch:

Mercer International: Fire at Stendal Pulp Mill Didn't Damage Mill Operations; Fire Primarily Extinguished, Site to Be Monitored for Hot Spots for Several Days; Fire Was Contained to Wood Chip Storage Bunkers, Associated Conveyances; Insurance Expected to Cover Business Interruption, Property Damage

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Other News:

A Canadian-Chinese billionaire is standing trial in mainland China more than five years after he mysteriously disappeared from Hong Kong, marking progress in a protracted case that has baffled the country's business community.

A trial of Xiao Jianhua, a politically connected financier who once boasted vast holdings from insurance to beet farming, was due to take place on Monday, said a spokeswoman for the Canadian Embassy in Beijing. "Canadian consular officials are monitoring this case closely, providing consular services to his family and continue to press for consular access," the spokeswoman said, adding that several Canadian requests to attend the trial proceedings were denied by Chinese authorities.

Read more here.

Expected Major Events for Tuesday

00:30/JPN: Jun Japan Services PMI

06:00/RUS: Jun Russian Services PMI

06:45/FRA: May Industrial production index

07:00/ITA: 1Q General Govt Quarterly Accounts

07:45/ITA: Jun Italy Services PMI

07:50/FRA: Jun France Services PMI

07:55/GER: Jun Germany Services PMI

08:00/UK: Jun UK monthly car registrations figures

08:30/UK: Jun UK Official Reserves

08:30/UK: Jun S&P Global / CIPS UK Services PMI