Economic Data
- (UK) CBI Industrial Report Sales: 24 v 18e- (IE) Ireland July Property Prices M/M: 0.9% v 0.1% prior; Y/Y: 9.4% v 10.7% prior
- (US) MBA Mortgage Applications w/e Aug 21st: +0.2% v +3.6% prior
- (BR) Brazil July PPI Manufacturing M/M: 0.7% v 0.3% prior; Y/Y: 7.6% v 6.7% prior
- (US) July Durable Goods Orders: +2.0% v -0.4%e; Durables Ex Transportation: 0.6% v 0.3%; Capital Goods Orders (Non-defense/ex-aircraft): 2.2% v 0.3%e; Capital Goods Shipments (Non-defense/ex-aircraft): 0.6% v 0.4%e; Durables Ex-Defense: 1.0% v 4.2% prior
- (BR) Brazil July Total Outstanding Loans (BRL): 3.11T v 3.103Te; M/M: 0.3% v 0.6% prior; Personal Loan Default Rate: 5.4% v 5.5%e - (US) DOE Crude: -5.45M v +0.5Me; Gasoline: +1.66M v -1.0Me; Distillate: +1.44M v +1.0Me
US equity markets rebounded from yesterday's late session rout, with the DJIA opening up 2% and the S&P500 up 2.2%, however markets are off their best levels mid-morning. The 10-year yield opened up at 2.150%, 10 bps off its premarket lows, but has come in a bit to 2.126% in the early going. As of writing, the DJIA is up 1.60%, the S&P500 is up 1.93% and the Nasdaq is up 1.65%.
The July advance durable goods report looked very strong, with both the headline and key capital goods orders crushing expectations. Capital goods orders saw their second straight increase and the biggest gain in over a year. In addition, the June numbers saw substantial upward revisions. There was one downside to the report, with durable goods inventories flat in July and the June inventories were revised lower.
New York Fed Governor Dudley warned this morning that a September rate hike was looking less compelling now than it did a few weeks ago, while also saying that normalization could very well look more attractive by the time of the September FOMC meeting. Addressing market talk circulating over recent days, Dudley said the Fed was "a long way from doing additional QE." Regarding recent moves in markets, Dudley restated the common Fed refrain that short-term market volatility doesn't have significant implications for US economy, but also warned that a large and prolonged drop in equity markets could have implications for the outlook.
WTI crude futures were trading in a tight range between $38.80 and $39.90 over the last 30 hours or so, compared to Monday's lows below $37.80. Last night, the API weekly inventory report out last night indicated the seventh straight week of inventory drawdowns and the largest withdrawal in six weeks, but the report did not have a lasting impact. This morning's DoE report also indicated a big drawdown in crude stocks, sending WTI momentarily down to $38.60, but the contract is higher as of writing.
Shares of Apple dropped below both the 50- and 200-day moving averages, forming the bearish "death cross" technical indicator. Many chart watchers view a "death cross" as marking the point where a short-term decline turns into a long-term downtrend. Shares of Apple have fallen 20% from the record high of $134.54 reached in April. The last death cross seen in shares of Apple was back on December 7th, 2012, although technicians noted that the 200-day moving average was still ticking higher at that time; today it is moving lower.
Monsanto has abandoned its bid to acquire Swiss agribusiness giant Syngenta. Yesterday evening, CNBC's Faber reported that some large Monsanto holders were airing their objections to a Syngenta deal, warning it may be difficult for Monsanto to get shareholder approval of a deal. Back in May, Syngenta rejected Monsanto's unsolicited CHF449/shr offer, valued around a total of $45 billion, citing antitrust concerns.
Looking Ahead
- 13:00 (US) Treasury to sell 2-Year Floating Rate Notes
- 13:00 (US) Treasury to sell 5-Year Notes
- 15:00 (AR) Argentina July Industrial Production M/M: No est v 1.2% prior; Y/Y: 0.1%e v 0.9% prior
- 22:00 (PH) Philippines Q2 GDP Q/Q: 1.7%e v 0.3% prior; Y/Y: 5.7%e v 5.2% prior
- 23:30 (TH) Thailand July Customs Trade Balance: $375Me v $150M prior; Customs Exports Y/Y: -3.8%e v -7.9% prior; Customs Imports Y/Y: -12.0%e v -0.2% prior
- 23:45 (JP) Japan to sell 2-Year JGB Bonds
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