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·         U.S. homebuilding rebounded more than expected in June after declining for three straight months, but construction activity remains constrained by rising lumber prices, labor and land shortages.

·         Housing starts jumped 8.3 percent to a seasonally adjusted annual rate of 1.22 million units, the highest level since February as both single-family and multi-family construction increased, the Commerce Department said on Wednesday.

 

May's sales pace was revised up to 1.12 million units from the previously reported 1.09 million units.

 

·         Building permits last month shot up 7.4 percent to a 1.25 million-unit rate, the highest level since March. Single-family home permits rose 4.1 percent after three straight months of declines. Permits for the construction of multi-family homes surged 13.9 percent in June.

·         The U.S. dollar rose against the euro on Wednesday a day after touching a more than one-year low, but it hit a more than three-week low against the yen as traders awaited meetings of the European Central Bank and the Bank of Japan.

 

·         Market watchers will be looking to see if the recent strength of the euro and the yen influence policy outlooks from the European and Japanese central banks.

·         The euro was last at $1.1517 EUR=, near the session low of $1.1511 and down about 0.3 percent. But it was still near Tuesday's more than one-year high against the greenback of $1.1583.

·         The dollar index, which measures the greenback against a basket of six rival currencies, was last up 0.2 percent at 94.791, not far from the more than 10-month low struck Tuesday of 94.476 .DXY.

·         The dollar was down 0.2 percent against the yen JPY= after touching 111.56 yen, its weakest level against the Japanese currency since June 27.

 

·         As their seven-year effort to repeal and replace Obamacare derailed in the U.S. Senate, Republicans faced the prospect of doing the once unthinkable: working with Democrats to make fixes to former President Barack Obama's 2010 healthcare law.

Bipartisan breakthroughs would likely come in the form of individual bills targeted at issues such as stabilizing insurance markets or lowering prescription drug costs. A wholesale overhaul of healthcare, senators say, is a bridge too far for the two parties, locked for years in an ideological battle on that issue and many others.

U.S. President Donald Trump took Senate Republicans to task on Wednesday for failing to reach agreement on overhauling Obamacare, as a new report showed 32 million Americans would lose health insurance if senators opt to repeal the law without a replacement.

·         U.S. President Donald Trump said on Wednesday he would not have appointed Jeff Sessions as attorney general if he had known Sessions would recuse himself from the Russia investigation, according to a New York Times interview.

An aggressive corporate lobbying effort to derail a Republican-backed border tax has forced lawmakers working on tax reform to seek alternatives, Kevin Brady, chairman of the tax-writing U.S. House Ways and Means Committee, said on Wednesday.

·         The European Central Bank (ECB) is widely expected to hold interest rates steady on Thursday with many market watchers expecting the bank to announce in September plans to reduce its bond-buying program.

·         The European Central Bank is expected to lay the groundwork for an autumn policy shift when it meets on Thursday, emphasizing improved growth while tempering expectations after previously setting off a mini tantrum in financial markets.

 ·         The Bank of Japan is set to paint a brighter picture of the economy on Thursday but cut its inflation forecasts again, reinforcing expectations that it will lag well behind major global central banks in scaling back its massive stimulus program.

With robust exports and private consumption pointing to a steady though modest economic recovery, the Japanese central bank is expected to hold off from expanding stimulus at its two-day rate review that ends on Thursday.

 

But stubbornly weak price growth will likely force the BOJ to cut its inflation forecasts, sources say, underscoring the challenges the central bank faces as it tries to reflate the economy and coax consumers into spending more.

·         Japan's exports rose for a seventh straight month in June led by shipments of cars and electronics, an indication external demand continues to support a gradual economic recovery and backing the central bank's upbeat economic view.

Ministry of Finance (MOF) data showed on Thursday that exports grew 9.7 percent year-on-year in June, versus a 9.5percent annual gain expected by economists in a Reuters poll. It followed a 14.9 percent year-on-year rise in the previous month.

·         Oil prices jumped almost 2 percent to a six-week high on Wednesday after a U.S. report showed a bigger weekly draw than forecast in crude and gasoline stocks along with a surprise drop in distillate inventories.

Brent LCOc1 futures for September delivery settled up 86 cents, or 1.8 percent, at $49.70, while U.S. West Texas Intermediate crude CLc1 for August settled up 72 cents, or 1.6 percent, at $47.12 on its second to last day as the front month.

 

That is the highest close for both contracts since June 6.

·         The Energy Information Administration (EIA) said U.S. crude stocks fell 4.7 million barrels during the week ended July 14. ENERGYUSA, exceeding estimates for a 3.2 million draw in a Reuters poll.

Reference: Reuters, CNBC