I. Yesterday's News
International News
1. The number of Americans filing for unemployment benefits fell more than expected by 8,000 last week, pointing to shrinking labor market slack that could allow the Federal Reserve to raise interest rates again this year despite moderate inflation growth. In another report, import prices declined 0.3 percent last month, the biggest drop in 15 months, as the cost of imported petroleum products tumbled. After the report, the dollar rose, U.S. Treasury yields edged higher, while gold fell to a three-week low on Thursday

2. The Bank of England shocked financial markets on Thursday when it said three of its policymakers voted for an interest rate hike, the closest it has come to raising rates since 2007. BoE policymakers Ian McCafferty and Michael Saunders joined previous rate rise advocate Kristin Forbes in voting to reverse the BoE's decision last August to cut rates to a record-low 0.25 percent, the BoE said. Governor Mark Carney and the four other members of the Monetary Policy Committee voted to leave rates unchanged. The BoE said on Thursday that a recent jump in inflation to 2.9 percent meant it was likely to exceed 3 percent this autumn - higher than the BoE forecast just a few weeks ago and well above its 2 percent inflation target. The fall in the pound after last week's election could push prices yet higher, the central bank said. The BoE also said consumer confidence looked solid, and indicators of investment and exports looked upbeat.

3. Euro zone lenders agreed on Thursday to lend 8.5 billion euros ($9.5 billion) to Greece, pulling the country from the brink of default, and gave some details on possible debt relief in 2018 as the International Monetary Fund agreed to join the bailout. The head of the euro zone bailout fund Klaus Regling told a news conference after the ministers' meeting that the disbursement of the money would take place in two tranches. The first would amount to 7.7 billion euros and come in early July to cover the repayment of 6.9 billion euros worth of maturing Greek debt and 0.8 billion of arrears. A further 0.8 billion euros would be disbursed "after the summer", Regling said. The IMF would join the Greek bailout, Lagarde told the news conference, offering Athens a standby arrangement of less than $2 billion, the length of which will be tailored to match the end of the euro zone bailout in mid-2018.

4. Australia's jobless rate fell to 5.5 percent, the lowest reading since February 2013 in May as hiring blew past all expectations for a third straight month. Employment jumped a seasonally adjusted 42,000 in May, again handily topping forecasts for a 10,000 gain. The upside surprise lifted the Australian dollar and led investors to further scale back to probability of another cut in interest rates.

5. The Swiss National Bank maintained its ultra-loose monetary policy on Thursday to steady prices and bolster economic activities. The SNB kept its target range for three-month Swiss franc LIBOR at -1.25 percent to -0.25 percent, and the rate it charges on sight deposits at -0.75 percent. It said it remained committed to negative interest rates and currency market interventions to rein in the Swiss franc, which it said remained "significantly overvalued".

Domestic News
6. As of the end of May, 42.39 million tonnes of crude steel capacity and 97 million tonnes of coal capacity had been cut, accounting for 84.8 percent and 65 percent of the annual goals, respectively, said the National Development and Reform Commission (NDRC). The country's top economic planner said it approved eight fixed-asset investment projects worth 51.8 billion yuan ($7.63 billion) in May.

7. Foreign direct investment into China fell 3.7 percent in May from a year earlier to 54.67 billion yuan, dripping for the second consecutive year, the Commerce Ministry said on Thursday. In the first five months of 2017, FDI fell 0.7 percent from the same period a year earlier to 341.08 billion yuan.

8. Data from China’s State Administration of Taxation showed 699.3 billion yuan was cut since the start of the VAT reform to the end of April. Tax payment in the four sectors adopting a VAT, namely construction, property, finance and life services, decreased by 241.9 billion yuan, while 98.7 percent of taxpayers saw their tax burden reduced.

9. The State Council, China's cabinet, Wednesday announced its decision to set up pilot zones in Guangdong, Guizhou, Jiangxi and Zhejiang provinces and Xinjiang Uygur Autonomous Region for green finance to support financial institutions to set up green finance departments, and welcome foreign capital including PE to participate in green investments. The State Council will also encourage the development of "green credit" to explore innovative green financial products.

10. China’s poorly-regulated trading exchanges were once again put on the radar of local governments and regulators. The CBRC Shanghai Office required banks under its jurisdiction to evaluate their cooperation with trade exchanges by special inspection and risk assessment.

II. Market Overview
FX
1. Global Market
The dollar rose to its highest in more than two weeks on Thursday as solid readings on the U.S. economy helped strengthen the case for the Federal Reserve to continue tightening monetary policy this year. The dollar index, which tracks the U.S. currency against six major peers, rose to 97.557, its highest since May 30. The dollar also hit its highest against the euro, Swiss franc and Swedish crown since May 30 following the data releases. The greenback rose to 110.97 yen, its highest against the Japanese currency since June 2. Sterling was last little changed against the dollar at $1.2757.

2. Home Market
China's yuan rose against the U.S. dollar with the midpoint rates hitting a seven-month high. Onshore forex market brushed off the Federal Reserve’s decision to raise interest rates. Proprietary institutions turned to cash in profits despite of demand for forex. Yuan is expected to keep rising in the near term.

Precious Metals
Gold fell to a three-week low on Thursday, weighed down by a stronger dollar as investors began to assess the potential for another U.S. rate hike later in the year, supported by data showing a strong U.S. jobs market. The losses in gold were limited, however, with bullion underpinned by myriad global uncertainties, including a report that U.S. President Donald Trump was under investigation. Spot gold fell 0.6 percent to $1,253.50 an ounce, after touching $1,251.18, the weakest since May 24. U.S. gold futures for August delivery settled down 1.7 percent at $1,254.60.

Commodities
1.Crude Oil
Oil prices settled more than half a percent lower on Thursday after hitting a six-month lows, as high global inventories fed fears that rising crude production in Nigeria, Libya and the United States will feed the global supply glut. Brent settled down 8 cents at $46.92 a barrel. U.S. crude settled down 27 cents at $44.46.

2.Base Metals
Copper fell for a fourth day on Thursday after the Federal Reserve lifted U.S. interest rates and took a more hawkish than expected stance on future policy, boosting the dollar and weighing on assets priced in the U.S. Currency. London Metal Exchange copper did not trade at the close but was last bid down 0.7 percent at $5,661 a tonne.

U.S. Treasuries
1. U.S. Bonds
Most U.S. Treasury yields edged higher on Thursday after stronger-than-expected U.S. economic data and as traders weighed hawkish Federal Reserve and Bank of England signals, but remained depressed as they did not fully reverse their biggest plunge in a month Wednesday. Yields on Treasuries maturing between 2-10 years rose, with two-year yields touching a three-month high of 1.368 percent. However, 30-year yields were last roughly unchanged from late Wednesday and the benchmark 10-year Treasury yields were last at 2.160 percent, from 2.138 percent late Wednesday.

2. Chinese bonds
China’s central bank did not raise repo rates in open market after the Federal Reserve tightened its interest rates. Yields of interbank cash bonds rebounded to the closing prices of the previous trading session, while Treasury bonds pared gains. The IRS steadied.

Stock Market
1. U.S. Equities
A recent slump in technology stocks worsened on Thursday, dragging on major U.S. indexes, while investors fretted about the economy's health after the Federal Reserve lifted interest rates. The Dow Jones Industrial Average fell 14.66 points, or 0.07 percent, to 21,359.9, the S&P 500 lost 5.46 points, or 0.22 percent, to 2,432.46 and the Nasdaq Composite dropped 29.39 points, or 0.47 percent, to 6,165.50.

2. Hong Kong Equities
Hong Kong stocks fell to a three-week low on Thursday, led by the property sector, as borrowing costs in the city looked set to rise after a U.S. interest rate hike. The Hang Seng index fell 1.2 percent, to 25,565.34, while the China Enterprises Index lost 1.6 percent, to 10,346.15 points.

3. China Equities
China’s stocks edged higher in a tight range on Thursday, driven by newly-listed stocks, while the hawkish statement by the Federal Reserve had a limited impact. Blue chips are expected to consolidate in coming sessions. The Shanghai Composite Index closed down 1.82 points or 0.06 percent to 3,132.49.