uesday saw European indices retrench a bit and US indices swing
back and forth between positive and negative territory in listless trading. Soft China import figures from yesterday, weak Germany ZEW survey results and duelling FOMC speakers between dove Brainard and hawk Bullard all provided excuses for moves but none really took hold in a meaningful way. Dovish comments from FOMC Governor Tarullo appear to have tipped the balance and sent US into a weak close.
We’re still in a transition phase with the weakest time of the year for stocks nearing an end. Many major indices successfully retested their August lows and rebounded, but now appear to be staging moderate trading corrections while remaining well above key support.
Dovish comments from RBNZ Governor Wheeler this morning have NZD on the back foot. He indicated that further easing appears likely although he remains data dependent. He said there have been some encouraging signs but there remain risks from a slowing global economy.
Earnings season remains a big focus with Intel and CSX beating the street but JPMorganChase coming in below expectations after the close today. Tomorrow brings reports from Bank of America and Wells Fargo in the morning and Netflix in the afternoon.
China data once again could have an impact on trading today as it may indicate how much room the PBOC has to engage in further monetary stimulus to help prop up the sagging China economy if needed. We also could see some activity in Australia and New Zealand markets today on continued reaction to yesterday’s weak China imports and ahead of tomorrow’s employment and PMI reports.
The FTSE didn’t fall as much as the Dax Tuesday, with its fall cushioned by strong UK same store sales, while GBP underperformed EUR. Employment figures could spark more activity in UK markets Wednesday. US markets, meanwhile could respond to retail sales and producer price reports heading into a busy back half of the week for US data that could drive more Fed interest rate speculation with two weeks to go until the next big decision.
Intel $0.64 vs street $0.59
JPMorganChase $1.32 vs street $1.38
CSX $0.52 vs street $0.50, maintains overall guidance but coal volumes now expected to fall 105 this year and remain weaker into 2016
Significant announcements released overnight include:
UK consumer prices (0.1%) vs street 0.0%
UK core CPI 1.0% vs street 1.1%
UK retail prices 0.8% vs street 1.0%
UK producer input prices (13.3%) vs street (13.0%)
UK producer output prices (1.8%) as expected
UK ONS house prices 5.2% vs street 5.0%
UK same store sales 2.6% vs street 1.5%
Germany ZEW current 55.2 vs street 64.0
Germany ZEW expectations 1.9 vs street 6.5
Upcoming significant economic announcements include:
10:30 am AEDT Australia consumer confidence previous 93.9
10:50 am AEDT Japan producer prices street (3.9%)
11:00 am AEDT Singapore GDP street 1.3%
12:30 pm AEDT China consumer prices street 1.8%
12:30 pm AEDT China producer prices street (5.9%)
9:00 pm EDT US Democratic presidential debate
7:45 am BST France consumer prices street 0.1%
8:00 am BST Spain consumer prices street (0.9%)
10:00 am BST Eurozone industrial production street 1.8%
9:30 am BST UK jobless claims street (2K)
9:30 am BST UK unemployment rate street 5.5%
9:30 am BST UK rolling 3M employment street 140K
9:30 am BST UK average weekly earnings street 3.1%
8:30 am EDT US retail sales street 0.2%
8:30 am EDT US retail ex auto street (0.1%)
8:30 am EDT US retail ex auto and fuel street 0.3%
8:30 am EDT US producer prices street (0.8%)
2:00 pm EDT US Beige book
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