Is “No Landing” Back?

What’s in Today’s Report:

• Is “No Landing” Back?
• Why Thursday’s Data Was Positive for the “Growth On” Basket

Futures are moderately higher mostly on momentum and end of quarter/half positioning, as economic data overnight was mixed but not bad enough to interrupt the rally.

European inflation (HICP) fell to 5.5% vs. (E) 5.7% y/y, although the more important core reading rose to 5.4% y/y from 5.3%, as expected.  So, there was some progress on headline inflation, but core inflation remains a problem.

In China, the June Manufacturing PMI rose to 49.0 vs. (E) 49.1, which is increasing expectations for more stimulus.

Today focus will be on inflation via the Core PCE Price Index (E: 0.4% m/m, 4.7% y/y).  The idea of “No Landing” requires inflation to, at a minimum, stay flat, so any hotter than expected inflation metric will push yields higher and that likely would weigh on stocks today.