If the data meaningfully disappoints, especially in the service sector, expect more risk off money flows amid growing recession worries today, wrote Tom Essaye, president of Sevens Report Research. Click here to read the full article.
The unexpected gain indicates that China’s post-pandemic recovery, which has long been marred by ongoing Covid lockdowns that ushered in the economy’s second-worst showing since 1976 last year, is gaining momentum, says Sevens Report analyst Tom Essaye, who notes the data helped fuel optimism across global markets on Wednesday. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower following underwhelming Chinese economic data and on a mild decrease in geo-political stability.
Chinese Retail Sales, Industrial Production, and Fixed Asset Investment all rose, but missed expectations and that’s weighing modestly on global stocks.
Geo-politically, the Taliban taking control of Afghanistan doesn’t have any direct market implications, but it is a political negative for Biden which could hurt the chances any infrastructure bill is passed.
Today the only notable economic report is the Empire Manufacturing Index (E: 30.0), and that’s more important than usual as markets will want to see if the Delta variant slowed economic activity in August. If this number badly misses expectations, it will likely be a headwind on stocks today.
What’s in Today’s Report:
Futures are slightly lower following a mostly quiet weekend of news as there were no major changes to the COVID outlook or the economic recovery.
Economic data was solid as German and Chinese exports for July both beat estimates.
Chinese CPI rose 1% vs. (E) 0.8% and that may reduce the amount of stimulus officials unleash on the economy (so potentially negative for global growth).
Today focus will be on JOLTS (E: 9825M) and on Fed commentary following the jobs report (Bostic at 10:10 a.m. ET and Barkin at 11:20 a.m. ET). But, unless JOLTS are a major surprise or Fed officials are shockingly hawkish, these events shouldn’t move markets. As such, the tenor of COVID headlines (and whether we are seeing behavior changes) will continue to drive markets in the near term.