So far "Triple Threat Thursday" has been a dud. In the day with the greatest concentration of market-moving risk events so far in 2017, market action - at least for the time being - has been a whimper, with European stocks and US futures modestly higher ahead of the ECB’s rate decision and Comey's testimony (which has now been fully publicized, removing much of the risk), as the U.K. voting is underway. Asian stocks fell led by a decline in Japan as the yen first strengthened, only to tumble later in the session. The Dollar is little changed while oil recovered from the steepest decline in more than a year Wednesday, while U.K. government bonds led the region’s debt lower as the nation chooses its next government a general election.

A quick summary of events courtesy of the always whimsical Kit Juckes from SocGen:

The ECB is edging towards the exit from extraordinary policies, the BOJ is recalibrating its exit communication strategy, whatever that means, the US is preparing for the start of the Comey show, and the UK is going to the polls, or the dogs, or both. In the meantime, markets are pretty quiet, with bond yields globally recovering a bit, and equity market edging higher with the exception of the Nikkei.

Starting in Asia, JGBs sold off aggressively and the curve bear steepened in reaction to reports of the BOJ considering future exit communications, pressuring USTs in early European trade. As USD/JPY reversed the entire knee-jerk move lower, core fixed income weakened further and the USD ground higher across G-10. European equity markets opened higher led by financials and basic resources sectors.The PBOC injected net 60 billion yuan of liquidity, weakening theCNY fixing for first time in seven days while China watchers exhaled after stronger than expected Chinese trade data gave support to industrial metals.

European stocks rose while U.S. futures edged higher before today's event trifecta. Copper led industrial metals higher as data showed an acceleration in Chinese exports while oil recouped a small portion of the more than 5 percent plunge triggered by a report showing a rise in U.S. crude stockpiles. Stock markets in London, Frankfurt and Paris were flat to 0.2% higher helped by reports of another bank rescue, this time in Italy, and energy shares as oil steadied after 5 percent drop the previous day. Italy's bonds also cheered the banking sector talk and the pound and the euro were at $1.2937 and $1.1233 respectively, the former near a two-week high and the latter just off a seven-month high.

The big FX story of the session so far was the USDJPY which took a beating early in the session after the market was spooked by a Bloomberg article stating that the BoJ is shifting its stance on its exit strategy. The article reported that the BoJ no longer intends to reiterate that “to discuss the exit strategy is premature” and that policymakers will focus on more effective communication with the markets. “The BoJ is re-calibrating its communications to acknowledge that it is thinking about how to handle a future exit from monetary stimulus, according to people with knowledge of discussions at the central bank." The strength lasted briefly though, and after sliding as low at 109.40, the USDJPY has since surged back over 110 and was trading at 110.10 last, as this particular trial balloon was digested and found severely lacking.

In economic data, Japan disappointed "bigly" earlier in the session when its Q1 GDP was revised to just 1.0% annualized, missing the 2.4% expected. The Japanese government's second estimate for Jan-Mar (1Q) 2017 real GDP came in at +1.0% qoq annualized, a sharp downward revision from +2.2% in the preliminary reading. However, this was mainly attributable to inventory, and the Japanese economy still looks to be trending firmly once this volatile factor is stripped out.

This was however offset in Europe by a small beat in Europe's GDP, which printed at 0.6%, fractionally above the 0.5% expected.

We gave a full UK election preview earlier, but for those pressed for time, here is a quick cheat sheet. For all the scenarios of a hung-parliament or Labour-led coalition, the central assumption is for a slightly increased majority for the ruling Conservatives and averaging the very diverse opinion poll projections points to the same. Spot sterling has been firm in recent days, although the jump in overnight implied volatility readings to some 30 percent – its highest since July – at least shows some pricing of possible risks over the next 24 hours.

Likewise for those curious what Draghi may do, our preview can be found here. Soundings on downgraded inflation forecasts and background trepidation about banking sector stability make it highly unlikely it will signal any major tightening of policy ahead later.

"We expect the ECB to tweak its forward guidance by dropping the easing bias on interest rates, while leaving the rest of its guidance largely unchanged, including the easing bias on asset purchases," UniCredit said in a note.

Commenting on the ECB, a somewhat bemused SocGen's Kit Juckes notes that "it goes without saying that recalibrating a communication strategy in advance of a decision to change policy, isn't the same as actually doing something. The BOJ meets next week and faces a -0.8% y/y GDP deflator in Q1, while the most recent core CPI reading is at zero. BOJ policy is geared to fighting deflation and as other central banks revise inflation forecasts lower, the idea that they could declare victory soon seems strange. For now, US yields - especially TIPS, are holding the lower end of rangers rather than breaking free, and we expect USD/JPY and EUR/JPY to do the same, before moving higher."

Former FBI Director James Comey's will be grilled by Washington politicians later over his claims that President Trump asked him to drop an investigation of former national security adviser Michael Flynn as part of a probe into Russia's alleged meddling in the 2016 presidential election. Although it keeps pressure on Trump, Wall St markets largely shrugged it off after Wednesday's written testimony as not toxic enough to ratchet up the threat of an impeachment.

Here is how DB's Jim Reid saw the release of the prepared Comey remarks:

In summary the general feeling was that it failed to contain a smoking gun and markets mostly ended up ignoring it. There were mentions of Trump asking for assurances on “loyalty” and also a reference to Trump requesting “let this go” with respect to the investigation into former National Security Advisor Michael Flynn. But Comey also confirmed that he did not understand the President to be talking about the broader investigation into Russia or possible links to the campaign. The White House released a statement shortly after Comey’s testimony was released saying that the President was pleased that Comey confirmed that Trump was not under investigation in any Russian probe and also that the President “feels completely and totally vindicated”. After briefly dipping lower midway through the session the S&P 500 (+0.16%) limped to a small gain by the close suggesting that the risk premium around the event has perhaps diminished. Should that change today then it’s worth noting that President Trump may live tweet if he feels the need to respond during the testimony according to the Washington Post which could make for some entertainment.

"To be honest I'm absolutely staggered about the degree to which this geopolitical environment and developments are having absolutely no effect on markets," said Saxo Bank head of FX strategy John Hardy.

"I'm old enough to remember how nervous the market used to get about this kind of stuff back in the day. I admit I don't know how to price it, but it's really staggering."

The biggest moves of the week so far remain centered around ebbing energy prices and inflation outlooks in general. Brent crude stabilized at $48.50 LCOc1 a barrel in European trading, after another steep drop briefly below $48 overnight. It is now down more than 7 percent year-on-year.With inventories showing no easing of the global glut, an ongoing row between Qatar and its Arab neighbors is seen as undermining the OPEC consensus about production cuts to limit oil supply.

Financially, the isolation of Qatar is taking its toll on the country’s debt and currency markets. Standard & Poor's downgraded Qatar's debt on Wednesday and Moody's warned on Thursday that it saw risks too if the situation continued. The riyal currency fell to an 11-year low and Qatari sovereign dollar bonds also extended losses of recent days. The cost of insuring exposure to the kingdom's debt rose to the highest level since mid-November.

"We expect that economic growth will slow, not just through reduced regional trade, but as corporate profitability is damaged because regional demand is cut off, investment is hampered, and investment confidence wanes," S&P said.

In addition to all of the above, we algo get initial jobless claims data due. Companies reporting earnings include JM Smucker and Dell Technologies.

Bulletin headline summary from RanSquawk

• European equities have seen little in the way of firm direction thus far with participants sitting on the side¬lines ahead of key risk events
• Similar price action has been observed across FX markets with overnight USD/JPY losses reversed ahead of Comey's testimony today
• Looking ahead, highlights include the ECB rate decision, Comey's testimony and the UK election exit poll

Market Snapshot

• S&P 500 futures up 0.1% to 2,433
• STOXX Europe 600 up 0.2% to 390.02
• MXAP down 0.2% to 155.09
• MXAPJ up 0.2% to 504.17
• Nikkei down 0.4% to 19,909.26
• Topix down 0.4% to 1,590.41
• Hang Seng Index up 0.3% to 26,063.06
• Shanghai Composite up 0.3% to 3,150.33
• Sensex down 0.08% to 31,247.58
• Australia S&P/ASX 200 up 0.2% to 5,676.60
• Kospi up 0.2% to 2,363.57
• German 10Y yield rose 0.7 bps to 0.276%
• Euro down 0.07% to 1.1249 per US$
• Italian 10Y yield rose 4.3 bps to 2.005%
• Spanish 10Y yield fell 2.7 bps to 1.541%
• Brent Futures up 0.7% to $48.41/bbl
• Gold spot down 0.1% to $1,285.75
• U.S. Dollar Index up 0.01% to 96.76

Top Overnight Stories from Bloomberg

• BOJ is re-calibrating its communications to acknowledge that it is thinking about how to handle a future exit from monetary stimulus
• Eurozone 1Q F GDP revised higher q/q to 0.6% from 0.5%; gross capex revised to 1.3% from 0.6% prev.
• Italy: finance ministry is pressing domestic banks to contribute EU1.2b to rescue the two Veneto banks
• German Apr. Industrial Production y/y: 2.9% vs 2.1% est; Economy Ministry says the solid development in orders and sales indicates a continued upswing
• China May Trade Balance: $40.8b vs $47.8b; imports 14.8% vs 8.3% est; exports 8.7% vs 7.2% est.
• Britain Votes as Narrowing Polls Indicate These Five Scenarios
• Draghi Still Missing Inflation as Growth Pushes ECB Near Exit
• China Stocks Atop Emerging World as Bubble Panic Forgotten
• Alibaba Expects 45-49% Revenue Growth in FY2018
• Moody’s Loses Hong Kong Red Flag Appeal Against Regulator
• Hewlett Packard CEO Says Profit Margins Will Improve in 4Q
• Teva Signals It’s Seeking New Chief With Experience at the Helm

Asia equity markets were choppy amid a cautious tone ahead of today's trifecta of key risk events including the UK election, ECB policy meeting and to a lesser extent, former FBI Director Comey's testimony after the pre-released statement didn't appear to be too damaging for President Trump. Indecisive trade was seen in ASX 200 (+0.1%) and Nikkei 225 (-0.3%), with Australia stocks initially led lower by weakness in energy after a surprise DoE build. However, a mild improvement in tone was observed amid encouraging Chinese Exports and Imports figures, while Japanese stocks were driven by a temperamental JPY. Shanghai Comp. (+0.3%) and Hang Seng (+0.3%) were underpinned by the Chinese trade data and after the PBoC conducted another respectable liquidity injection. 10yr JGBs saw volatile trade with prices pressured throughout the session despite a downward revision to Q1 GDP figures and a better than prior 5yr auction. Selling was later exacerbated heading into the European open with some analysts attributing the pressure to an article that the BoJ is tweaking its communications to suggest it is contemplating how to handle a future QE exit. As reported last night, the Chinese Trade Balance rebounded to (CNY)(May) M/M 281.6bIn vs. Exp. 324.1 bin (Prey. 262.3bIn).Chinese Exports (CNY)(May) Y/Y 15.5% vs. Exp. 13.5% (Prey. 14.3%) Chinese Imports (CNY)(May) Y/Y 22.1% vs. Exp. 8.3% (Prey. 18.6%) .

Top Asian News

• BOJ Is Said to Re-Calibrate Communications on Future Exit
• Hong Kong Stocks Inch Higher as China Trade Data Beat Estimates
• Indofood Sukses to Purchase Land From CEO Salim: First Pacific
• Iran Acid Attacker Wounds 16 in Tehran: Fars
• Chinese Automakers Rise After Vehicle Sales Reverse Drop in May
• Japan’s Yield Curve Steepens Further Led by Super-Long Bonds
• Alibaba Foresees Sales Growth of As Much As 49 Percent This Year
• Sungrow Power Rises to Highest This Year After Prelim. 1H Profit
• U.S., China Team for First Mainland Offshore Commodities Index

European equities have traded with subdued behaviour throughout this 'Super Thursday'. Key risk events today will take focus, with participants awaiting the EU interest rate decision, former FBI Director Comey's testimony, with the UK election exit polls due at 22.00 BST. Sector specific trade is evident of the tentative behaviour, as Utilities outperform assisted by an upgrade for E.ON alongside a continuation of yesterday's tax ruling. Telecoms are the noticeable laggard in the Stoxx 600 following Vodafone going ex div, trading down over 3%. Fixed Income markets have taken influence from Asia, as the G7 10 yr yields take impetus from JGBs, following an article that the BOJ is tweaking its communications to suggest it is contemplating how to handle a future QE exit. As such, Bunds and Gilts both trade lower on the day, as the Gilt Sep'17 future contract looks towards the 128 handle. 

Top European News

• Hung Parliament, Labour Win Risks Daunt Traders Day of U.K. Vote
• Merkel and Macron Hand Boost to Bulgaria’s Euro Aspirations
• Petronet Slides Most in Seven Months After Engie Sells Stake
• Kinnevik Sells Final $244 Million Stake in Rocket Internet
• European Miners Gain; Citigroup Sees Opportunity Following Slump
• Pandora Advances; Jyske Says Positive Signet Signs Help Shares
• Kinnevik’s Timing on Rocket Exit ‘Somewhat Odd’: Northern Trust
• Allianz Said to Explore Buying Rest of France’s Euler Hermes
• Hedge-Fund Bet on Banco Popular Collapse Yields Maximum Gain

In currencies, the Bloomberg Dollar Spot Index added 0.1 percent as of 9:57 a.m. in London. The pound was little changed at $1.2961 while the yen and euro weakened 0.1 percent. USD/JPY saw some bearish pressure following the overnight BoJ article, however, found a bid around 109.40. Elsewhere, currency markets identify the quiet tone as we approach the aforementioned risk events. EUR/USD and EUR/GBP have been evident of this, trading in a range bound fashion throughout the European morning, as EUR/GBP has the highest overnight implied volatility since Brexit. For EUR/USD and the rest of the cross rate, it is all about the ECB meeting today, and source stories suggesting that inflation forecasts will be revised lower saw longs taking a hit, though the spot move ran back into fresh demand ahead of 1.1200, and we are back in position to retest 1.1280-1.1305 should the press conference

In commodities, oil recovered slightly from the biggest drop since February 2016 after a surprise expansion in U.S. stockpiles. West Texas Intermediate crude added 0.7 percent to $46.05 a barrel. Gold dropped 0.1 percent to $1,285.23 an ounce. Industrial metals climbed as China’s imports and exports expanded more than expected. Copper advanced 1 percent to $5,676.50 a metric ton while zinc gained 1.4 percent and nickel rose 0.7 percent. WTI held near yesterday's lows and failed to make any significant recovery from the DoE-triggered losses, in which an unexpected build pushed prices lower by around 5% to beneath USD 46/bbl. Elsewhere, gold prices slipped slightly alongside the mildly firmer greenback, whilst copper gained amid the better than expected Chinese Exports and Imports data.

Looking at the day ahead, aside from the obvious UK election, ECB meeting and Comey testimony focus there is also a bit of data due out. In Europe this morning we receive April industrial production in Germany which came in at 0.8%, stronger than expected (+0.5% mom expected) which will be an important hard data point to see in context of the recent PMIs. Also due out is the final Q1 GDP report for the Euro area which also beat at 0.6%, (exp. 0.5%). Consensus is for no change to the +0.5% qoq initial reading. This afternoon in the US we receive the latest weekly initial jobless claims data. Away from that Draghi’s press conference at 1.30pm BST post the ECB decision will of course be worth watching.

US Event Calendar

• 8:30am: Initial Jobless Claims, est. 240,000, prior 248,000
• 8:30am: Continuing Claims, est. 1.92m, prior 1.92m
• 9:45am: Bloomberg Consumer Comfort, prior 51.2
• 12pm: Household Change in Net Worth, prior $2.04t

DB's Jim Reid concludes the overnight wrap

Once a decade there's a particularly depressing day that you have to endure and try to find a way to come to terms with. Sadly yesterday was that day for me. Yes my new passport arrived as the old one was expiring and a (relatively) youthful photo of me from 2007 was replaced by a more haggard version of me from 2017. Given I travel quite a bit I tend to see a lot of my passport photo and still cling on to that old image being the true reflection of me. Not anymore. By the time the next one comes along though I'll have had a decade of looking after twins to add yet more worry lines!!

Anyway welcome to “Super Thursday”. I’ll be voting in the UK soon after this email hits inboxes. If you’re in the UK I hope you do too unless you disagree with me and then I hope you don’t. I suppose one of the surprising features of this election is that if the polls* are to be believed (not a given clearly), then the UK will go back to a 2-party state again. Current polling puts the combined support for the two main parties at around 80%. The last three elections have seen combined support between 65-68%. In the 11 eleven elections since 1974, only 1979 (80.8%) saw it above 80%. Between 1945-1970 it was between 87-97%. Across the developed world there has generally been a fragmentation of politics in recent years, especially in Europe after the financial crisis, with lots of populist movements forming and taking votesaway from the establishment. Indeed in the recent French elections the two main parties failed to make the second round for the first time in the 60 years of the current set-up. So why has this reversal occurred in the UK and does it mark a return to establishment politics? Well post-Brexit, UKIP no longer serves the same purpose as it has done and the Liberal Democrat Party don't seem to have captured the imagination in focusing a large part of their campaigning on a second EU referendum. Given that 48% voted against Brexit it seemed a reasonable strategy but most people in the UK seemed to have moved onand have accepted the will of the people so it’s not been a campaign issue that has seemingly resonated. Although the two main parties have seen a relative combined revival it does feel this is more circumstantial and we’d still expect this to be the exception with anti-establishment politics likely to be around for years to come, especially in Europe. The last 6 general elections in Europe have actually seen these parties under-perform the final polls but I think this is as much to do with the recent cyclical strength in the European economy. The structural issues are still there. Back to today, here is a link to DB’s election guide, with timings and what to watch for.

Elsewhere today we have the ECB meeting and Mr Comey’s testimony to the Senate. On the ECB, our economists changed their call last week. They now think the balance of probabilities have shifted away from a change to forward guidance so soon with the soft May flash inflation print last week perhaps helping to offset confidence in the growth outlook. They still expect some soft exit expectations management, for example, talking up economic growth and tasking the internal committees to consider the options for forward guidance, deposit rate and QE. Strong growth and low inflation probably allows Draghi to be upbeat but hold back from big changes today.

On this, the big story yesterday was a press report suggesting that the ECB was preparing to cut its inflation forecast at today’s meeting. A Bloomberg article claimed that projections will now be at 1.5% for 2017, 2018 and 2019 against 1.7%, 1.6% and 1.7% back in March. If true this would be a big move as it would really be difficult to see a taper being announced until they edged higher again. The article did however say that ‘forecasts for core inflation, excluding energy and food, are likely to be little changed’. These were at 1.1%, 1.5% and 1.8% in March. A Reuters article subsequently said that ECB sources indicate that any changes made will be small, in some cases as tiny as 10bps. This led to a round trip in yields and the Euro yesterday albeit in what was still quite a tight range. Indeed 10y Bunds were up a couple of basis points in the early going at 0.267% prior to the headlines hitting, before quickly falling to a low of 0.242%, only to then rebound into the close to finish at 0.265% and up 1.7bps on the day. The intraday range in BTPs was 5.6bps while Spain and Portugal also saw ranges of 5.1bps and 5.9bps respectively. The Euro also traded in a 0.70% range versus the Dollar and ultimately finished down a fairly modest -0.18%.

Meanwhile with regards to Comey’s testimony, yesterday we got an early look at the former FBI Director’s prepared remarks. In summary the general feeling was that it failed to contain a smoking gun and markets mostly ended up ignoring it. There were mentions of Trump asking for assurances on “loyalty” and also a reference to Trump requesting “let this go” with respect to the investigation into former National Security Advisor Michael Flynn. But Comey also confirmed that he did not understand the President to be talking about the broader investigation into Russia or possible links to the campaign. The White House released a statement shortly after Comey’s testimony was released saying that the President was pleased that Comey confirmed that Trump was not under investigation in any Russian probe and also that the President “feels completely and totally vindicated”. After briefly dipping lower midway through the session the S&P 500 (+0.16%) limped to a small gain by the close suggesting that the risk premium around the event has perhaps diminished. Should that change today then it’s worth noting that President Trump may live tweet if he feels the need to respond during the testimony according to the Washington Post which could make for some entertainment.

That small gain for the S&P last night was more notable in the face of a decent leg lower for Oil. WTI plummeted -5.13% following the latest EIA data which showed crude, gasoline and distillate supplies allunexpectedly rising last week (crude breaking a run of 8 consecutive weeks of supply declines). That meant WTI settled at $45.72/bbl which is only a smidgen below the $45.52/bbl closing low for 2017 recorded last month. Beyond that, the last time WTI went below $45.50/bbl was back in November. Oil-sensitive currencies struggled in the wake of that (Norway, Canada and Russia down 0.5-1.0%) although interestingly Treasury yields did climb a little higher (2y +1.4bps, 10y +2.8bps, 30y +2.5bps) – albeit in the context of a decent move down for yields of late. It’s worth noting also that the 2y10y spread did close at 84.7bps last night which is the lowest since October last year. That spread got as wide as 136bps back in December and was also in the mid 100’s just last month so there’s been a reasonable flattening recently which is a worry for those of us that think the yield curve is a good macro predictor.

This morning in Asia risk assets appear to be mostly waiting on the sidelines with only small moves up or down for the Nikkei (+0.05%), Hang Seng (-0.01%), Shanghai Comp (-0.06%), ASX (+0.07%) and Kospi (-0.35%). The latter perhaps underperforming following the news of another missile launch by North Korea. Data in China this morning showed that both exports and imports rose more than expected in May. Meanwhile in Japan the final Q1 GDP print in Japan revealed that growth in the quarter was lower than first estimated at +0.3% qoq (from +0.5% in the flash reading). The consensus was actually for a one-tenth upward revision to +0.6%. While we’re on Japan its worth highlighting that yesterday a Reuters report hit the wires suggesting that the BoJ may upgrade its view on the economy as early as next week, but at the same time may be forced to cut inflation forecasts given a stubbornly weak price outlook. That almost feels like a repeat of the ECB story yesterday.

On to geopolitical tensions, the Middle East situation continues to grab headlines on an almost daily basis at the moment. Iran yesterday blamed a terror attack in Tehran on Saudi Arabiaand vowed to take revenge while the UAE Government warned of a possible economic embargo on Qatarshould the Gulf state not change its course. Qatar’s credit rating was also downgraded one notch by S&P to AA- and put on CreditWatch negative. While not necessarily having a direct impact right now on wider markets the tensions in the Middle East are certainly bubbling below the surface.

Closer to home, aside from the ECB focus the other main story for the market was the rescue of Banco Popular by Santander and the subsequent wiping out of AT1 debt of Popular. This follows the Single Resolution Board stepping in and announcing resolution action after stating that the entity was “failing or likely to fail”. For context Popular’s 11.5% AT1 perps were trading at Par at the end of March and have now been effectively written down to zero. The move was however reasonably isolated with no huge impact to other AT1 bonds issued by Euro banks. The iTraxx Sub Fins (+1bp) did underperform relative to Sen Fins (-2bps) but the magnitude of the move wasn’t all that significant. In equity markets the Stoxx 600 closed -0.06% yesterday.

Before we wrap up, with regards to the economic data yesterday, in the US the sole release was consumer credit in April which was reported as rising just $8.2bn during the month (vs. $15.0bn expected) which was the smallest increase since August 2011. In Germany factory orders in April disappointed at -2.1% mom (vs. -0.3% expected) although the annual rate still remains up at +3.5% yoy. In the UK the Halifax house price index rose +0.4% mom in May after expectations were for a small decline.

Looking at the day ahead, aside from the obvious UK election, ECB meeting and Comey testimony focus there is also a bit of data due out. In Europe this morning we receive April industrial production in Germany (+0.5% mom expected) which will be an important hard data point to see in context of the recent PMIs. Also due out is the final Q1 GDP report for the Euro area. Consensus is for no change to the +0.5% qoq initial reading. This afternoon in the US we receive the latest weekly initial jobless claims data. Away from that Draghi’s press conference at 1.30pm BST post the ECB decision will of course be worth watching.