Dollar Treasurys Steady Ahead of Yellen

 
Snapshot: 

        -10-year Treasury yield at 2.41%; EUR/USD at 1.1023-26; U.S. stock futures slightly higher; Nymex at $52.73; gold at $1153.70
        -Watch for: U.S. producer prices, industrial production, Empire State manufacturing survey; Bank of Canada interest rate announcement and press conference with BOC's Poloz; Canada May manufacturing; Fed's Yellen monetary policy report; Fed Beige Book; speech from Fed's Mester; earnings from Bank of America, BlackRock, Delta Airlines, Corus Entertainment; after the close: Intel, Netflix
        News: China Surprises With 7% Growth; IMF Says Greece Needs Far More Debt Relief; White House Cuts Growth Forecast for 2015, 2016
        In early European trade Wednesday, the euro was little changed against the dollar at around $1.1005.
        The dollar was flat against the yen in Asian trade, with investors reluctant to take lopsided trading positions ahead of a busy day of market-moving events including Federal Reserve Chairwoman Janet Yellen's semiannual testimony to Congress.
        Ms. Yellen will testify on the economic outlook and monetary policy to the House Financial Services Committee on Wednesday and the Senate Banking Committee on Thursday. She will likely echo her speech last week in Cleveland, where she reaffirmed that the Fed is on track to begin raising short-term interest rates this year but avoided specifics on the timing and predicted moderate growth over the course of the year.
        The dollar also maintained stability after China's slightly-better-than-expected economic growth and the Bank of Japan's decision to stand pat at its monetary policy meeting.
        At 5.50am ET, USD/JPY was at 123.58-59.
        Sterling, meanwhile, dropped against the dollar and euro after June jobless claims rose. GBP/USD fell from a two-week high at $1.5674.
        Treasury yields were off the lows seen in the wake of Tuesday's disappointing retail sales data and were steady in Europe ahead of Ms. Yellen's monetary policy statement.
        Commerzbank said she is likely to use the opportunity to further prepare the market for the fact that a first rate hike before the end of the year is quite possible, albeit still data dependent.
        At 5.42am ET, the 10-year U.S. Treasury yielded 2.41%, compared with 2.399% late Tuesday.
        European government bond markets were stable by midmorning. Long and superlong Japanese government bonds were slightly firmer.
        U.S. stocks were on track for a fifth straight day of gains, with futures inching higher ahead of Ms. Yellen's testimony
        Futures for the Dow nudged 8 points higher to 17,969, while those for the S&P 500 gained 1.15 points, or 0.1%. Futures for the Nasdaq added 7 points, or 0.2%.
        "Greece had been a key obstacle which might have prevented the Fed from actively considering imminent U.S. interest rate rises," said Rebecca O'Keeffe at Interactive Investor. "With this problem now close to resolution, the path has been cleared for the Federal Reserve to raise rates sooner."
        Investors also face a packed data calendar. At 8.30am ET, the Empire State manufacturing index for July is due, forecast to climb to 4 from a negative reading of 2 in June. At the same time, the producer price index for June is released. Economists polled by MarketWatch expect a print of 0.2%, down from 0.5% in May, while core PPI is predicted to stay at 0.1%.
        Industrial production for last month comes out a 9.15am ET and should show a 0.1% rise, according to estimates, compared with a 0.2% fall in May.
        Meanwhile, financial reports from the banking sector continue with Bank of America forecast to report second-quarter earnings of 36 cents a share ahead of the bell, according to analysts polled by FactSet. The bank is among the stocks that Morgan Stanley is upbeat on ahead of its earnings report.
        Also premarket, Delta Air Lines is projected to report second-quarter earnings of $1.21 a share, up from $1.04 a share a year ago, while BlackRock is forecast to report second-quarter earnings of $4.80 a share, down from $4.89 a share a year earlier.
        After the market closes, Intel and Netflix are slated to report.
        Brent crude was 0.3% lower at $58.53 early in Europe. While the nuclear deal between Iran and six world powers is bearish for oil prices as it could boost Iranian crude exports, it also clears some of the uncertainty that has been weighing on oil markets in recent days.
        Gold was flat at $1153.70.
        China Surprises With 7% Growth
        China's growth remained at 7% in the second quarter, a level economists had deemed unlikely, amid broad signs that Beijing's policies to jump-start the economy had yet to take hold.
        IMF Says Greece Needs Far More Debt Relief
        The IMF questioned the ability of Greece to deliver on promised bailout overhauls and warned in its starkest language yet that Europe must commit to debt relief to ensure the program will work.
        White House Cuts Growth Forecast for 2015, 2016
        The White House said it sees U.S. growth rising by just 2% this year before rebounding to 2.9% in 2016-down from its earlier forecast of 3% growth for both 2015 and 2016 released in February-after the economy stalled during the first quarter.
        New Oil Players Line Up to Bid on a Piece of Mexico
        As Mexico opens its oil industry to competition for the first time in nearly 80 years, several Mexican businessmen have helped create homegrown oil companies to compete with former state monopoly Pemex.
        Celgene to Buy Biotech Receptos for $7.2 Billion
        Cancer-drug company Celgene said it will pay $7.2 billion for biotech company Receptos in a bid to move deeper into the multibillion-dollar market for autoimmune diseases.
        Air Force Will Offer Bonuses To Lure Drone Pilots
        The Air Force is taking steps to address a chronic shortage of drone pilots, sweetening the allure of flying the unmanned planes as part of a plan to alleviate the strains as it tries to meet demands for drones and the video intelligence they provide.
        Write to Riva Gold at riva.gold@wsj.com @GoldRiva
        (END) Dow Jones Newswires

        July 15, 2015 06:17 ET (10:17 GMT)

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