Deutsche Bank drags on Europe as Q3 winds down, Canada GDP and Chicago PMI due today
Stock markets in continental Europe are getting hammered again today. Deutsche Bank remains under fire with its shares falling under €10 before rebounding amid reports hedge funds have started to pull excess cash out of the Bank which faces up to $14 billion in US fines. The Dax is down 1.3% today with the FTSE down 1.1%. EUR has also been falling as sentiment toward the continent's banking system sours with EUR falling relative to USD, GBP and JPY.
US index futures have stabilized following thursday's selloff trading down 0.2% despite losing energy sector support. WTI and Brent Crude are down 1.2% and 1.6% respectively as the bullish OPEC and inventory news subsides and traders take profits ahead of the weekend.
It's the last day of the quarter so we may see general repositioning of trades and portfolios today and traders positioning ahead of next week's PMI and payrolls reports.
There also is a lot of economic news for the markets to digest today. Japanese data was mixed with deflation deepening but industrial production beating expectations. China manufacturing PMI was just above 50 and in line. UK GDP over quarter and house prices were slightly above expectations.
Canada GDP for July may attract significant attention from traders. The Bank of Canada had been hoping for a summer rebound in Canada from the spring wildfire disruptions. In its last monetary policy statement the bank indicated July was not looking weaker than expected so today's data may indicate if pressure on Governor Poloz to cut interest rates this year is increasing.
In the US, Chicago PMI may attract some attention as a leading indicator for manufacturing PMI reports due over the weekend and into Monday. There are fewer Fed speakers today but this week's comments indicated that hawkishness at the Fed goes far beyond the three members who actually dissented at the last meeting. Traders may continue to look at incoming data in terms of how it may impact the prospects of a December rate increase but there's still the matter of the election campaign first.
There have been no major corporate announcements this morning
China Caixin manufacturing PMI 50.1 as expected
Japan unemployment rate 3.1% vs street 3.0%
Japan household spending (4.6%) vs street (2.1%)
Japan consumer prices (0.5%) as expected
Japan core CPI 0.2% as expected
Japan industrial production 4.6% vs street 3.4%
Japan housing starts street 7.1%
Japan construction orders previous (10.9%)
NZ ANZ activity outlook 42.4 vs previous 33.7
NZ ANZ business confidence 27.9 vs previous 15.5
UK Nationwide house prices 5.3% vs street 5.0%
UK GDP update 2.1% vs street 2.2%
Germany retail sales 3.7% vs street 1.8%
France consumer prices 0.4% as expected
Norway unemployment rate 2.8% vs street 2.9%
Italy unemployment rate 11.4% as expected
Eurozone unemployment rate 10.1% vs street 10.0%
Eurozone consumer prices 0.4% as expected
Eurozone core CPI 0.8% vs street 0.9%
Upcoming significant economic announcements include:
8:30 am EDT US personal income street 0.2%
8:30 am EDT US personal spending street 0.1%
8:30 am EDT US Core PCE inflation street 1.7%
8:30 am EDT Canada GDP street 1.0%
8:30 am EDT Canada industrial prices street (0.1%)
8:30 am EDT Canada raw material prices street (1.0%) vs previous (2.7%)
9:45 am EDT US Chicago PMI street 52.0
10:00 am EDT US consumer sentiment street 90.0
1:00 pm EDT US Baker Hughes drill rig count previous 511
1:00 pm EDT FOMC Kaplan speaking
9:00 pm EDT China manufacturing PMI street 50.4
9:00 pm EDT China non-manufacturing PMI previous 52.5
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