“Bottom line, worries about the economy spiked this week, and the last thing this market needs is a soft jobs number to reinforce the idea that any trade truce next week between the U.S. and Chins is ‘too late’ to help manufacturing sentiment. So, it’s not often the case, but the stronger this jobs report, the better, as a strong report will help calm any…” says Sevens Report Research founder Tom Essaye. Click here to read the full article.
What’s in Today’s Report:
Futures are enjoying a modest oversold bounce despite more trade noise and disappointing economic data.
On trade, the U.S. imposed $ 7.5 billion worth of tariffs on the EU following a WTO ruling. But, while the headline is scary, this was widely expected and not a new negative.
Economic data was soft again as Japanese and EU composite PMIs and the UK services PMI all missed estimates.
Today the focus will be on economic data and the key report is the ISM Non-Manufacturing Index (55.4). If it badly misses expectations, concerns about a broader economic slowdown will grow further, and that will weigh on stocks again. We’ll also be watching Jobless Claims (E: 215K) for any signs of slowing in the labor market.
There are also several Fed speakers today, but with rate cuts expected, I doubt they will say anything too material. Speakers today include: Quarles (8:30 a.m. ET), Mester (12:10 p.m. ET), Clarida (6:35 p.m. ET).
“On Saturday, the Treasury Department stated it’s not considering blocking Chinese companies from listing on U.S. exchanges ‘at this time,’ refuting the Bloomberg story from Friday, which caused the declines in stocks…” wrote Tom Essaye, president of the Sevens Report, in a note to clients. Click here to read the full article.
Today’s Report is attached as a PDF.
What’s in Today’s Report:
It is a mixed start to Q4 today as U.S. stock futures are modestly higher, Asian shares rallied overnight following a rate cut by the RBA (although Chinese markets are notably closed for a holiday), while European markets declined on soft economic data.
September Manufacturing PMI data remained decidedly weak in Europe with Germany’s headline index notably falling from 43.5 to 41.7, the lowest since June 2009. Inflation in the Eurozone meanwhile remains weak with the core HICP figure meeting estimates at 1.0% year-over-year.
Looking into today’s session, there are three economic reports to watch this morning: PMI Manufacturing Index (E: 51.0), ISM Manufacturing Index (E: 50.0), and Construction Spending (E: 0.3%) and a busy schedule of Fed speakers: Clarida (8:50 a.m. ET), Bullard (9:15 a.m. ET), and Bowman (9:30 a.m. ET).
Beyond those potential catalysts in the morning, markets will remain focused on the political drama surrounding the impeachment proceedings by the House against Trump as well as any further updates on the U.S.-China trade war as the latter continues to be the single most important influence on global markets right now.
What’s in Today’s Report:
Futures are modestly higher on more U.S./China optimism following a quiet night of actual news.
U.S./China trade talks are officially scheduled for October 10th and 11th and rhetoric from both sides remains positive ahead of the event. At this point, a pretty comprehensive U.S./China trade truce is fully expected by the market.
Economically, EU Economic Sentiment and Chinese Industrial Profits both slightly missed estimates although neither number is moving markets.
Today there are two notable economic reports, Durable Goods (E: -1.2%) and Core PCE Price Index (E: 0.2% m/m, 1.8% y/y) and we need to see a “Goldilocks” result of solid Durable Goods (to ease fears about business spending and investment) and tame inflation (Core PCE Price Index is the Fed preferred measure of inflation and it needs to print sub 2%).
There are also two Fed speakers today, Quarles (8:30 p.m. ET) and Harker (12:00 p.m. ET), but neither should move markets.
Tyler Richey interviewed with Mid-Day Movers from TD Ameritrade discussing Nike, Foot Locker, Under Armour earnings, markets, and more…Click here to watch the full video.
“Futures are higher with most overseas markets thanks to positive trade headlines…” writes the Sevens Reports’ Tom Essaye. Click here to read the article.
What’s in Today’s Report:
Stock futures are extending losses this morning and international equity markets were broadly lower overnight as political and trade uncertainties weigh on sentiment.
Speaker of the House, Nancy Pelosi, formally announced an impeachment inquiry regarding President Trump’s interactions with the President of Ukraine which has added to an already crowded list of potential market headwinds.
Otherwise, it was a relatively quiet night of news with no material economic data releases and no trade war developments.
Today, there is one economic report to watch: New Home Sales (E: 665K) and a relatively busy schedule of Fed speakers: Evans (8:00 a.m. ET), George (10:00 a.m. ET), and Kaplan (7:00 p.m. ET). There is also a 5-Yr Treasury Note Auction at 1:00 p.m. ET and based on yesterday’s very solid 2-Yr Auction that helped steepen the yield curve, the results could once again influence the stock market.
Beyond those scheduled market catalysts, investors will be focused on the fluid impeachment situation as well as sensitive to any trade war developments.
“Gold has fallen into a broad, near-term trading range between support at $1,500 and resistance above at $1,560. There are multiple influences on gold right now that could trigger…” said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
“These are not good numbers and they do not imply global economic stabilization is occurring,” said Tom Essaye, founder of The Sevens Report, in a note. Click here to read the full article.
