What’s in Today’s Report:
- Political Risks to This Market
Futures are sharply lower (about 1%) as bad economic data is furthering worries about a slowdown in global growth.
Chinese Retail Sales (8.1% vs. (E) 9.0%) and Industrial Production (5.4% vs. (E) 5.9%) both badly missed estimates.
In Europe, the flash composite PMIs also missed expectations at 51.3 vs. (E) 52.5.
Geopolitically it was a quiet night although Chinese officials confirmed the reduction of auto tariffs to 15% from 40% (this was already pledged but it is good to see it will be enacted on Jan 1.).
Today it’s all about economic data. The numbers from China and the EU this morning were not good and fears of a global economic slowdown are rising, and we need Retail Sales (E: 0.1%) and Industrial Production (E: 0.3%) to push back on that narrative, otherwise today could be another ugly day.