fter two days of declines, stock markets in North America and Europeent most of the day bouncing back into the green with the Dax
regaining the 12,000 level. Stocks slid in the last hour as it became clear that the House vote on US health care reform would have to be delayed until at least Friday in the USbecause it doesn't have enough votes to pass due to disagreements between moderate and conservative Republicans. Originally it looked like the vote could occur during today’s Asia Pacific trading session.
This is important because it is the first piece of marquee legislation for the new Administration. The huge market rally since the election has been based on the assumption that reform legislation would be passed and implemented quickly, smoothly and with limited opposition. Defeat or delay could force traders to rethink this assumption and could spark more profit taking. Even a vote to pass the bill by a small margin could indicate that the political road ahead may be bumpier than the street has been thinking as the bill already faces more challenges in the Senate next week where the Republicans have a smaller majority.
It was a light day for economic news. UK retail sales beat the street boosting Sterling, while positive US new home sales were offset by higher jobless claims. There are a number of economic reports due between now and the end of the week. NZD could be active around New Zealand trade figures. The Kiwi and Aussie Dollars have been soft overnight Flash manufacturing and service PMI reports for the US, Japan, Germany and France are set to give the first indication of how the global economy is acting in March so far. US durable goods orders, meanwhile, may provide some insight into whether the manufacturing sector in the US is on the rebound.
There have been no major corporate reports after the US close today.
Significant announcements released overnight include:
UK retail sales 4.1% vs street 3.2% vs previous 2.6%
UK retail ex auto 3.7% vs street 2.6% vs previous 1.5%
UK CBI retail sales 9 vs street 4
UK CBI distributor sales 32 vs street 20
US jobless claims 258K vs street 240K
US new home sales 592K vs street 565K
US natural gas (150 BCF) vs street (149 BCF)
UK Kansas City Fed manuf 20 vs street 14
Upcoming significant economic announcements include:
(Note: 11:30 am in Sydney/Melbourne is currently 1:30 pm in Auckland, 4:30 pm in Vancouver, 7:30 pm in Toronto/Montréal, 12:30 am in London and 8:30 am in Singapore)
TBA US House of Representatives votes on health care reform bill
7:00 pm EDT FOMC Kaplan speaking
8:45 am AEDT NZ trade balance street $180M
11:30 am AEDT Japan flash manufacturing PMI previous 53.3
7:45 am GMT France GDP street 1.2%
8:00 am GMT France flash manufacturing PMI street 52.4
8:00 am GMT France flash service PMI street 56.1
8:30 am GMT Germany flash manufacturing PMI street 56.5
8:30 am GMT Germany flash service PMI street 54.5
8:30 am EDT Canada consumer prices street 2.1%
8:30 am EDT Canada median core CPI previous 1.9%
8:30 am EDT US durable goods orders street 1.3%
8:30 am EDT US durables ex transport street 0.6%
8:30 am EDT US capital goods non defense ex air street 0.5%
9:45 am EDT US flash manufacturing PMI street 54.7
9:45 am EDT US flash service PMI street 54.0
8:00 am EDT FOMC Evans speaking
10:00 am EDT FOMC Dudley speaking
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