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Daily Briefing: Surprised Germany votes to legalise same-sex marriage
June 30, 2017 / 7:47 AM / 5 months ago

Daily Briefing: Surprised Germany votes to legalise same-sex marriage

LONDON (Reuters) - To the surprise of many, and possibly Angela Merkel herself, the German parliament has voted to legalise same-sex marriage.

An unidentified couple kisses after a session of the lower house of parliament Bundestag voted on legalising same-sex marriage, in Berlin, Germany June 30, 2017. REUTERS/Fabrizio Bensch

In Germany, most social reforms come about after months, if not years, of agonised public debate. This one happened rather haphazardly when Merkel, who sits at the centrist end of her CDU conservative party, this week suggested she was open to debate on the matter - a gambit that was in fact supposed to push it into the long grass until after September’s election.

Yet left-leaning and other lawmakers - all of whom have made the measure a criterion for joining a future coalition with Merkel - pounced on her remarks and forced an early vote on it.

While the development has angered many of the CDU’s more socially conservative supporters, it might prove to work in Merkel’s favour as it gets this particular bone of contention out of the way: by the time Germans go to the poll in three months time, it will be old news.

Britain’s economy lost a lot of its momentum in early 2017 and data due at 0830 GMT will give a sense of how it started the second quarter, a key consideration for the Bank of England as it ponders when to raise rates for the first time in a decade.  

The April reading of the giant services industry comes along with final details of GDP growth in the January-March period, including business investment which the BoE is watching closely. The ONS also publishes figures for the current account deficit, the Achilles heel of the economy which, in the words of BoE Governor Mark Carney, has left the country dependent on the kindness of strangers.


The driver in markets on Friday, the last day of the second quarter, is still the noises from central bankers suggesting the era of cheap stimulus is coming to an end.

German 10-year government bond yields have just hit their highest in three months, the dollar touched a nine-month low against a basket of major currencies and stocks fell in Asia.

Inflation data from the euro zone and the United States are likely to be the day’s most closely watched indicators.

The dollar index, which measures the greenback against a basket of currencies is down 1.8 percent this week while the euro is trading close to a 14-month high and on track for its best quarter in seven years.

Blame ECB President Mario Draghi’s hint at tweaks to the bank’s stimulus policy and question marks over the pace of Federal Reserve interest rate hikes.

German Chancellor Angela Merkel gestures as members of the lower house of parliament Bundestag vote on legalising same-sex marriage, in Berlin, Germany June 30, 2017. REUTERS/Fabrizio Bensch

The euro was last flat at $1.1440, the yen was down 0.1 percent at 112.06 to the dollar and sterling up,0.1 percent at $1.3018.

European shares are set to open slightly higher, after Asia-Pacific shares excluding Japan dropped 0.7 percent and Tokyo stocks fell 0.9 percent. Chinese shares are trading mixed after data showed factory activity unexpectedly increased at its fastest pace in three months.

Selling pressure is expected to ease today for European shares with futures trading broadly flat after the region’s main equity benchmark posted in the previous session its worst day in nine months.

After four consecutive months of gains, the STOXX 600 index is set to end June with a fall of more than 2 percent, its worst month in one year as worries over tightening monetary conditions that boosted bond yields and the euro prompted a sell-off in export oriented stocks and in sectors that like lower rates.

Slideshow (3 Images)

In an equity market dominated by macro factors, company news is unlikely to play a big role, although there is some corporate news, especially among mid caps that could affect single stocks. Among large caps, traders said Adidas will be in the spotlight after rival Nike posted stronger than expected results, sending its shares up sharply.

Single stock movers: Unipol reorganises group insurance business, sets up bad bank; online druggist Zur Rose narrows IPO price range at top end; Roche buys diabetes app-maker mySugr in digital health push; Russia's Polyus says prices its SPO at lower end of range; VW tells California plans for electric car charging in poorer areas; Deutsche Bank rejects U.S. Democrats' call for Trump finance details; Haldex withdraws support for Knorr-Bremse bid; BHP updates on legal settlement over the Samarco mine disaster in Brazil.

Oil is up and on track for its biggest weekly gain since mid-May. Brent crude last up 30 cents a barrel at $47.72. The weak dollar and strong Chinese data helped lift copper 0.1 percent to just below $6,000 a tonne.

Emerging equities slipped 0.5 percent and looked set to end the month flat but up over 5 percent for the quarter. Chinese mainland stocks were flat on the day, although the Chinese manufacturing sector expanded at the quickest pace in three months in June, helped by new orders.

But the Chinese yuan fared better, firming 0.2 percent and set for its best quarter since June 2008, helped by a weaker dollar and the better-than-expected manufacturing data. The yuan is up about 1 percent for the week, its best week since July 2005, and is up 1.7 percent against the dollar for the quarter.

South Korean stocks retreated after industrial production missed analyst forecasts by a large margin and the won weakened as much as 0.5 percent to an 11-week low. It is down about 2.1 percent for the quarter.

The South African rand lost 0.2 percent against the dollar but the lira was steady ahead of trade figures for both.

The rouble firmed 0.2 percent, helped by a rise in oil prices but Russian stocks will stay in focus as the U.S. Senate has resolved a technical issue that stalled a new package of sanctions on Russia. The measure still faces opposition in the House, but Russian stocks are set to end the month down 5 percent.  

The Czech crown was 0.2 percent weaker against the euro, having gained on Thursday after the Czech central bank said it could be heading towards its first interest rate rise in almost a decade in the third quarter.

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