Dentalfloss
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Ostwald, Marc
Attachments
08:15 (10 minutes ago)
to Marc
- G7 flash PMIs dominate end of week schedule: UK PSNB, Canada CPI & Retail
Sales, Brazil mid-month CPI and Colombia Q2 GDP also due; Scholz/Albayrak
meeting; 'Quadruple Witching' and GICS tech sector reclassifications
the focus for equity markets; Week ahead to focus on FOMC and quarter end
- PMIs: Eurozone Manufacturing PMIs seen edging down, US up; Services PMIs
seen little changed; absolute levels still suggestive of solid pace of
activity
- Canada CPI/Retail Sales: headline CPI seen edging down, core around
target, Retail Sales expected to signal solid pace of consumer spending
- Charts: US 10-yr yield, VIX and V2X volatility indices, US Treasury MOVE
volatility index
..........................................................................
********************
** EVENTS PREVIEW **
********************
Today is above all "quadruple witching" in equity futures and options in Europe and North America, with the data and events schedule relatively modest, as markets look ahead to the FOMC meeting, and month & quarter end next week. Statistically flash PMIs for Japan, Eurozone and the US top the schedule, with Japan's national CPI to be digested ahead of the UK PSNB, Canada's CPI and Retail Sales, while the CEE & EM space has Polish Retail Sales, Brazilian mid-month inflation and Colombian Q2 GDP. In scheduled event terms, there is little more to chew over than a meeting between German Finance Minister Scholz and his Turkish counterpart Albayrak. This likely serve to underline that however unpopular and reviled Erdogan may be with the German body politic, it simply is not in Germany or the EU's interest (economic and geo-strategic) to allow Turkey to slide into chaos. However broader political themes such as Brexit, and trade tensions will continue to provide the more significant mood music for financial markets, even if market reaction (i.e. rallying GBP) to what was a seemingly fatal EU torpedo to UK PM May's Chequers plan was rather perverse, though perhaps motivated by the 'strong' retail sales data despite the obvious counter about how much of that spending was financed by a renewed jump in consumer debt (next report: 1 0ct). It sho0uld also be noted that S&P & MSCI are due to implement GICS stocks reclassification today, which will sharply impact a number of ETFS - for more see: https://www.wealthmanagement.com/etfs/how-upcoming-gics-sector-changes-impact-your-etf-portfolio and https://mobile.reuters.com/article/amp/idUSKCN1LZ2JT?
** World - September 'flash PMIs' **
- the G7 'flash' PMI forecasts are as ever rather agnostic, but in broad terms seeing Eurozone Manufacturing edging lower, but US edging up, with Services in both seen little changed, though in all cases still suggesting a solid pace of expansion. While there will doubtless be the extrapolative outpourings of opinion on what the data imply for G7 growth prospects, much of the hair splitting variety, today's run appears unlikely to offer any genuinely significant insights. The Japan Manufacturing survey (52.9 vs. 52.5) underlined a simple point that while companies are very concerned about trade tensions presenting major headwinds going forward, current order flows and output remain robust.
** Canada - August CPI / July Retail Sales **
- There remains a considerable volume of water to flow under the bridge, in terms of data and political developments, before the Bank of Canada next meets on 24th October, a meeting at which markets are discounting an 88.5% probability of a further 25 bps rate hike. As such today's run of major data is unlikely to be a game changer in market rate expectation terms, let alone for the BoC. Be that as it may, Retail Sales are expected to signal a solid start to Q3 Personal Consumption, with a headline rise of 0.3% m/m seen, while ex-Autos measure forecast to post a punchy 0.6% m/m, in and of itself offering support for further BoC tightening. CPI is forecast to paint a familiar picture on inflation, with a dip in energy prices likely to pull down headline down by 0.1% m/m, allowing the y/y rate to dip to 2.8% from 3.0%, while core CPI is seen around 'target' at an unchanged 1.9% y/y.
from Marc Ostwald
Attachments
08:15 (10 minutes ago)
to Marc
- G7 flash PMIs dominate end of week schedule: UK PSNB, Canada CPI & Retail
Sales, Brazil mid-month CPI and Colombia Q2 GDP also due; Scholz/Albayrak
meeting; 'Quadruple Witching' and GICS tech sector reclassifications
the focus for equity markets; Week ahead to focus on FOMC and quarter end
- PMIs: Eurozone Manufacturing PMIs seen edging down, US up; Services PMIs
seen little changed; absolute levels still suggestive of solid pace of
activity
- Canada CPI/Retail Sales: headline CPI seen edging down, core around
target, Retail Sales expected to signal solid pace of consumer spending
- Charts: US 10-yr yield, VIX and V2X volatility indices, US Treasury MOVE
volatility index
..........................................................................
********************
** EVENTS PREVIEW **
********************
Today is above all "quadruple witching" in equity futures and options in Europe and North America, with the data and events schedule relatively modest, as markets look ahead to the FOMC meeting, and month & quarter end next week. Statistically flash PMIs for Japan, Eurozone and the US top the schedule, with Japan's national CPI to be digested ahead of the UK PSNB, Canada's CPI and Retail Sales, while the CEE & EM space has Polish Retail Sales, Brazilian mid-month inflation and Colombian Q2 GDP. In scheduled event terms, there is little more to chew over than a meeting between German Finance Minister Scholz and his Turkish counterpart Albayrak. This likely serve to underline that however unpopular and reviled Erdogan may be with the German body politic, it simply is not in Germany or the EU's interest (economic and geo-strategic) to allow Turkey to slide into chaos. However broader political themes such as Brexit, and trade tensions will continue to provide the more significant mood music for financial markets, even if market reaction (i.e. rallying GBP) to what was a seemingly fatal EU torpedo to UK PM May's Chequers plan was rather perverse, though perhaps motivated by the 'strong' retail sales data despite the obvious counter about how much of that spending was financed by a renewed jump in consumer debt (next report: 1 0ct). It sho0uld also be noted that S&P & MSCI are due to implement GICS stocks reclassification today, which will sharply impact a number of ETFS - for more see: https://www.wealthmanagement.com/etfs/how-upcoming-gics-sector-changes-impact-your-etf-portfolio and https://mobile.reuters.com/article/amp/idUSKCN1LZ2JT?
** World - September 'flash PMIs' **
- the G7 'flash' PMI forecasts are as ever rather agnostic, but in broad terms seeing Eurozone Manufacturing edging lower, but US edging up, with Services in both seen little changed, though in all cases still suggesting a solid pace of expansion. While there will doubtless be the extrapolative outpourings of opinion on what the data imply for G7 growth prospects, much of the hair splitting variety, today's run appears unlikely to offer any genuinely significant insights. The Japan Manufacturing survey (52.9 vs. 52.5) underlined a simple point that while companies are very concerned about trade tensions presenting major headwinds going forward, current order flows and output remain robust.
** Canada - August CPI / July Retail Sales **
- There remains a considerable volume of water to flow under the bridge, in terms of data and political developments, before the Bank of Canada next meets on 24th October, a meeting at which markets are discounting an 88.5% probability of a further 25 bps rate hike. As such today's run of major data is unlikely to be a game changer in market rate expectation terms, let alone for the BoC. Be that as it may, Retail Sales are expected to signal a solid start to Q3 Personal Consumption, with a headline rise of 0.3% m/m seen, while ex-Autos measure forecast to post a punchy 0.6% m/m, in and of itself offering support for further BoC tightening. CPI is forecast to paint a familiar picture on inflation, with a dip in energy prices likely to pull down headline down by 0.1% m/m, allowing the y/y rate to dip to 2.8% from 3.0%, while core CPI is seen around 'target' at an unchanged 1.9% y/y.
from Marc Ostwald
