What’s in Today’s Report:
- Sevens Report Economic Breaker Panel – October Update: A Macro Breaker Flipped
US stock futures are slightly lower this morning as EU shares are declining on renewed concerns about Italy’s budget despite mostly good economic data overnight.
The Italian Parliamentary Budget Office raised doubts about the government’s growth forecast of 1.5% in 2019 which would ultimately mean a larger budget deficit than previously expected, and that has triggered risk-off money flows this morning.
Economically speaking however, Industrial Production data across Europe was generally better than expected and revisions were mostly positive. While that is currently being overshadowed by the Italian budget drama, it is a positive for the medium term outlook for EU markets.
Today, we get our first of two notable inflation figures this week: PPI (E: 0.2%) as well as Wholesale Trade (E: 0.8%) and there are two Fed speakers to watch: Evans over the lunch hour (12:15 p.m. ET) and Bostic after the close (6:00 p.m. ET).
Otherwise, focus will remain on bond yields and tech shares. For stocks to continue to stabilize or turn higher this week, we will need to see the former hold steady or even pullback slightly and the latter once again outperform.