The big picture of today
Asian stock indices ended the day largely lower, driven by 1.1% declines in Hong Kong’s Hang Seng and China’s Shanghai Composite. Japan’s Nikkei closed 1.1% higher on the day while South Korea’s Kospi fell 0.6% and India’s Sensex was unchanged. At midday, European stock indices were slightly lower overall and US futures are pointing to a mixed start.
Investors will look again to today’s weekly report on jobless claims for an idea of the pace of the nationwide reopening, as well as the first GDP review in 2Q 2021. Today also gives the highly anticipated 2021 Jackson Hole Economic Policy Symposium kicks off and investors will be listening to comments on the Fed’s plans to cut monetary policy. On Friday, the spotlight will be on Fed Chairman Jerome Powell, but given a variety of factors, including the Citibank (C) Economic Surprise Index (CESI) again in negative territory; the growing list of companies pushing back office hours to early 2023; the upcoming expiration of federal impact payments; and further delays in the $ 1 trillion infrastructure bill, we believe the Fed will wait for the August jobs report before clarifying its reduction plans.
Following the move of Swiss Air and United Airlines (UAL) earlier this month, Delta Airlines (DAL) announced yesterday that it will start billing up to $ 200 per month to unvaccinated employees enrolled in its health care plan.
A survey by the business lobby, Partnership for New York City, found that 23% of Manhattan’s roughly 1 million office workers were back in the office by mid-August, up from 12% in May. About 44% of employers surveyed by the group said they delayed their plans to return to the office due to the Delta variant. About 60% said they would require returning employees to show proof of vaccination and just under half expect to need masks, regardless of their vaccination status.
Yesterday, the Dutch statistical agency CPB released its latest global trade data, which revealed that while trade volumes have remained fairly stable at an annual rate of around $ 18.9 trillion (in 2010 USD) , the rise in prices has pushed the overall value of the trade to new highs. for four consecutive months. Emerging market trade is near an all-time high, but excluding China, emerging market trade share is declining after steadily increasing from 2004 to 2015.
South Korea’s central bank decided to raise its key rate by 25 basis points to 0.75% today, as widely expected. It was the first rate hike in nearly three years and the first Asian economy to tighten monetary policy since the start of the pandemic.
Consumer confidence in Germany fell to -1.2 in September from -0.4 in August, weaker than the expected drop to -0.7.
Business confidence in France rose slightly to 110 in August from 109 in July, from which it should only drop slightly to 109. The business climate indicator (which summarizes the information provided by surveys in industry, services, retail and wholesale trade and construction) fell to 110 from 113 in July.
Wednesday’s durable goods report for July contracted less than expected, falling -0.1% mo after June’s increase of 0.8%, but better than the expected decline of -0, 3%. More specifically, this is the first drop in three months, driven by a -2.2% contraction in orders for transport equipment and a 5% drop in capital goods. Orders for non-defense capital goods, which is a closely watched proxy for corporate spending plans, remained unchanged after rising 1.0% in June.
Later today, we’ll have the usual weekly jobless claims, second quarter GDP estimate, second quarter business profit estimate, second quarter PCE prices, and second quarter. Kansas Fed manufacturing index for August.
The S&P 500 and the Nasdaq Composite both rose 0.2% yesterday, their fifth consecutive day of gains, leading to another day of intraday highs, with the S&P 500 hitting the 4,500 level for the first time, it closed at 4,496.19. The Dow Jones Industrial Average rose 0.1% and the Russell 2000 rose 0.4%.
Crude oil continued its rally yesterday, surpassing $ 68 a barrel after EIA data revealed a third straight week of inventory drawdowns, which is usually around this time of year.
Actions to watch
Ahead of the opening of US stock markets this morning, investors will be looking at several earnings reports, including those of Abercrombie & Fitch (ANF), Burlington Stores (BURL), Coty (COTY), Dollar General (DF), Dollar Tree (DLTR), Hain Celestial (HAIN), Sanderson Farms (SAFM), and Tal Education (TAL).
After the market closed yesterday, strong quarterly earnings reports have been released by Williams-Sonoma (WSM), Ulta Beauty (ULTA), NetApp (NTAP), and Salesforce (CRM). All three presented a more optimistic outlook than expected while Splunk (SPLK) posted better-than-expected results for the July quarter, but guided the current quarter in line with consensus expectations. Actions of Snowflake (SNOW) Aftermarket trading also declined, as the company’s outlook predicted slower sales growth from levels seen in recent quarters. Actions of To guess? (GHG) also fell following the 2022 forecast calling for single-digit year-over-year revenue decline.
Microsoft (MSFT) said it would invest $ 20 billion over five years, a fourfold increase from current rates, to accelerate its cybersecurity work. Microsoft also announced that it will make $ 150 million in technical services available to help federal, state and local governments keep their security systems up to date. Google (GOOGL) announced that it will invest $ 10 billion over the next five years to expand zero trust programs, help secure the software supply chain, and improve open source security.
Following today’s market close, Dell (DELL), Gap (GPS), HP (HPQ), Marvell (MRVL), Peloton (PTON) and VMWare (VMW) will be among the companies to release their latest quarterly results. . Those looking to get a glimpse of the revenue reports to be had in the coming days should visit Nasdaq earnings calendar page.
On the horizon
- August 26: Unemployment claims, Q2 GDP growth, corporate profits
- August 27: Personal Income and Expenditure, Wholesale Inventories, PCE Price Index, Merchandise Trade Balance, University of Michigan Consumer Sentiment Report
- August 30: Pending home sales, Dallas Fed Manufacturing
- August 31: S & P / Case-Shiller Home Price Index, Chicago PMI, Conference Board Consumer Confidence, API Crude Oil Inventory Report
- September 1: change in ADP employment, Markit manufacturing PMI, ISM manufacturing PMI, construction spending, crude oil and gasoline inventories EIA, total vehicle sales
- September 2: US trade balance, unit labor costs Q2, weekly jobless claims, nonfarm productivity Q2, factory orders
- September 3: Non-farm payroll, Markit Services PMI, ISM Non-Manufacturing PMI
- September 8: US JOLTs reports IBD / TIPP economic optimism, API crude oil stocks
- September 9: Weekly unemployment claims, EIA Energy Stocks,
- September 10: PPI, Inventories of wholesalers
- September 13: Monthly budget statement
- September 14: Inflation, API crude oil stocks
- September 15: export and import prices, NY Empire State Manufacturing Index, industrial production, EIA crude and gasoline inventories
- September 16: Retail sales, weekly jobless claims, Philadelphia Fed manufacturing index, business inventories, net capital flows, foreign bond investment
- September 17: University of Michigan consumer sentiment report
Thought of the day
“We make a living with what we get, but we make a living with what we give.” -Winston Churchill
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.