Economic Data
- (IL) Israel July CPI Forecast: No est v 1.4% prior- (IL) Israel July Jun M1 Money Supply Y/Y: No est v 19.7% prior
- (PT) Portugal Jun PPI M/M: 0.0% v 0.0% prior; Y/Y: -0.4 v -0.6% prior
- (RU) Russia Gold and Forex Reserve w/e Jul 11th: $476.7B v $474.3b prior
- (TR) Turkey Central Bank (CBRT) cut its Benchmark Repurchase by 50bps to 8.25% (as expected)
- (BR) Brazil May Economic Activity M/M: -0.2% v -0.4%e; Y/Y: -0.2% v -0.3%e
- (PL) Poland Jun Sold Industrial Output M/M: -0.1% v +2.0%e; Y/Y: 1.7% v 3.7%e
- (PL) Poland Jun PPI M/M: 0.0% v -0.1%e; Y/Y: -1.7% v -1.8%e
- (RU) Russia Jun Unemployment Rate: 4.9% v 5.0%e
- (RU) Russia Jun Real Retail Sales M/M: 0.4% v 1.4%e; Y/Y: 0.7% v 1.8%e
- (US) Jun Housing Starts: 893K v 1.020Me; Building Permits: 963K v 1.035Me
- (US) Initial Jobless Claims: 302K v 310Ke; Continuing Claims: 2.507M v 2.580Me
- (CA) Canada May Int'l Securities Transactions: C$21.4B v C$5.0Be
- (ZA) South Africa Central Bank (SARB) raises Interest Rate by 25 bps to 5.75%
- (US) July Philadelphia Fed Business Outlook: 23.9 v 16.0e
- (US) Weekly EIA Natural Gas Inventories: +107 bcf v +97-101 bcf expected range
- The new Russia sanctions, jitters about the Chinese economy and the weak housing data undercut futures in the premarket, sending the S&P500 sharply lower, exacerbated by losses in European trading. US indices returned to positive territory mid morning. As of writing, the DJIA is down 0.14%, the S&P500 is down 0.10% and the Nasdaq is down 0.40%.
- This morning's June housing starts and building permits numbers were not confidence-inspiring. The June figure missed expectations by 100K and the reading was at its lowest level since September 2013. Meanwhile the May starts figure was revised lower. June single-family starts fell to 575K, their lowest level since November 2012. Major US homebuilders are down 1.5-2.0% a piece on the news.
- The reversal in crude continues. The front-month WTI contract traded as high as $103 earlier this morning before dropping right back to the lower end of the $102 handle. Meanwhile the larger-than-expected build seen in EIA weekly inventory data sent front-month natural gas below $4.00 for the first time in seven months.
- Microsoft said it would lay off up to 18,000 workers over the next year, and take a pretax charge of $1.1-1.6 billion to pay for the cuts. Two thirds of these cuts come in Microsoft's ill-fated hardware division, representing about half of the total employees that the Nokia deal brought into the company in April. Shares of MSFT gained 2% yesterday on early reports of the cuts, and another 3% before the bell today on confirmation. Currently MSFT is up 2.2% on the day.
- Morgan Stanley reported strong results for its second quarter. Profits were up nearly 50% y/y, driven by strong performance in the wealth management, investment banking and equity sales units. Shares of MS were up 2.0% at one point this morning but are well off their highs.
- There is a steady drip of takeover chatter going around this morning. On the Time Warner front, a NYT report suggested that the company doesn't have a broadcast network, making CBS a nice possible fit for a defensive acquisition. There was a German press report that Volkswagen was mulling a bid for Fiat, although both firms denied the report. Dresser-Rand is up 13.4% after reports that Siemens was considering takeover after losing out on Alstom.
- Yesterday's post-market earnings losers are sinking further this morning. Sandisk's headline numbers were ok but guidance was weak, driving shares down 12% this morning in cash trading. YUM! Brands is at its lows, down 4%, after executives on this morning's conference call were unable to say anything to inspire confidence, claiming they still were counting on a "bounce back in China" but warned China comps would be weaker in the second half.
- The totals from the Farnborough Airshow are in and Airbus has clearly beat rival Boeing in the aircraft order stakes. Airbus took twice as many orders and commitments: 496 aircraft valued at $75 billion. Demand for its A320 neo was particularly strong. Boeing won $40.2 billion in orders for 201 airplanes.
Looking Ahead
- 11:15 (BR) Brazil to sell 2015, 2016 and 2018 Bills- 11:15 (BR) Brazil to sell Floating-rate 2020 Notes
- 13:30 (BR) Brazil Jun Total Formal Job Creation: +53.5Ke v +58.8K prior
- 13:35 (US) Fed's Bullard speaks on Monetary Policy in Owensboro, Kentucky
- 15:00 (US) API Monthly Statistical Report
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Ethereum resume sideways move as Grayscale files to withdraw Ethereum futures ETF application with the SEC
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No obvious macro catalysts to steer the bus
The US data calendar remains relatively light, with initial jobless claims and the University of Michigan survey being the key focus. However, these releases may not provide a significant catalyst for the next directional move in the US Dollar.