ISM Data Points To Rising Odds of a Hard Landing
What’s in Today’s Report:
- Trading Color – Quarterly Rebalancing Helps Improve Breadth
- ISM Manufacturing Index Takeaways – Not a Good Report
- If the Yield Curve Is Right, The U.S. Economy Will Roll Over Hard
U.S. equity futures are tracking global markets lower this morning after more disappointing PMI data overnight.
Economically, China’s June Composite PMI dropped to 52.5 from 55.6 in May with the Services Index notably missing estimates at 53.9 vs. (E) 55.9. Meanwhile, the Eurozone Composite PMI fell into contraction at 49.9 vs. (E) 50.3.
Looking into today’s session, there are two economic reports to watch: Motor Vehicle Sales (E: 15.3 million) and Factory Orders (E: 0.9%), although barring any huge surprises, neither should materially move markets ahead of the Service PMI data and June jobs report due later in the week.
From there, focus will turn to the release of the June FOMC Meeting Minutes at 2:00 p.m. ET as markets look for further clarity on the Fed’s commitment to raising rates further in H2’23 (a hawkish interpretation would weight on risk assets).
Finally, there is one Fed speaker: Williams but not until the closing bell at 4:00 p.m. ET so any impact by his comments will likely not be realized until tomorrow.
