The Latest on Taiwan and China

What’s in Today’s Report:

  • The Latest on Taiwan and China
  • JOLTS Decline But Remain Historically Elevated
  • Big One-Day Reversal in the 10-Year Yield: Chart

Stock futures are trading cautiously higher this morning as geopolitical angst is easing after Pelosi’s departure from Taiwan while economic data was mostly positive overnight.

Chinese and EU Composite PMIs for July topped estimates while Eurozone PPI was no worse than feared and that data is helping some of the hawkish fears from Tuesday unwind.

Looking into today’s session, earnings season is beginning to wind down but there are still a few notable reports due out today: MRNA ($4.50), CVS ($2.16), YUM ($1.08), HOOD (-$0.36), EBAY ($0.89), and MGM ($0.24).

However, the market’s main focus will be on economic data today with ISM Services Index (E: 53.0) and Factory Orders (E: 1.1%) both due out shortly after the open while there is one Fed speaker: Harker (10:30 a.m. ET).

Investors will want to see still solid growth numbers in the data, further easing in inflation readings, and hopefully a less hawkish tone out of the Fed if the July relief rally is going to extend into August.

Market Multiple Table: August Update

What’s in Today’s Report:

  • Market Multiple Table: August Update
  • Chart: JOLTS Hit New Record

Stock futures are little changed this morning as investors digest Monday’s hawkish Fed chatter and continue to monitor the status of the Delta variant outbreak around the globe.

Economically, Germany’s August ZEW Survey was moderately disappointing while domestically, the NFIB Small Business Optimism Index came in at 99.7 vs. (E) 103.3, however neither report is materially moving markets given the recent focus on the very strong July jobs report in the U.S.

On infrastructure, the $1.2T bipartisan bill is expected to pass a final vote in the Senate later this morning but that has largely been priced into markets already.

Today, there is one economic report to watch: Productivity and Costs (E: 3.5%, 1.2%) and one Fed speaker: Evans (2:30 p.m. ET).

Additionally, there is a 3-Year Treasury Note auction at 1:00 p.m. ET, and a soft outcome could result in another wave of hawkish money flows like we saw on Monday (yields higher, dollar higher, mixed price action in equities).

Market Multiple Levels: S&P 500 Chart

What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart
  • May JOLTS Report Takeaways

Stock futures are sharply lower along with most international equity markets this morning while bond yields are extending recent declines amid new COVID-19 concerns.

Japanese Prime Minister, Yoshihide Suga, issued a state of emergency for Tokyo overnight and the latest reports suggest spectators will be banned from the summer Olympics which is weighing heavily on investor sentiment today.

10-Year yields are down another 7 basis points in early trade while travel and leisure shares are leading markets lower in the pre-market, underscoring concerns about the state of the economic recovery and emerging concerns surrounding the Delta variant of COVID-19.

Today, there is just one economic report: Jobless Claims (E: 353K) and no Fed officials are scheduled to speak.

Investors will be looking for a continued drop in the weekly jobless claims data but focus will likely be on COVID-19 trends and the latest lockdown developments as the health of the economic recovery is reassessed.

Why the JOLTS Report Matters to Markets

What’s in Today’s Report:

  • Why the JOLTS Report Matters to Markets

Stock futures are little changed this morning while overseas markets were down modestly overnight as a sense of trader paralysis grips global markets ahead of key catalysts due in the back half of the week.

Economically, Chinese PPI hit 9.0% vs. (E) 8.3% in May, the hottest reading since 2008, however, May CPI was 1.3% vs. (E) 1.5%, keeping inflation fears relatively subdued.

There are no market moving economic reports on the calendar for today and no Fed officials are scheduled to speak however the Treasury will hold a 10-Yr Note auction at 1:00 p.m. ET.

The Treasury auction could move markets today but only if there is a big surprise in the results as markets are more likely to continue to churn into tomorrow’s CPI report and ECB Announcement.