Chillin' out till it needs to be funded
The ISM Services indices, comparable to PMIs in other geographies, jumped to 56 even as the sub indices for unemployment followed the declining numbers on the Employment situation Report on Friday and good news from Services PMI all over Europe except in India and China carried the momentum for equities when markets open on Monday. Markets for big Pharma were upbeat too on counts from Q2 results and even if the economic data does not turn up its nose or James Bullard mentions that we need a close look at H2 data to review the reality of the Economic recovery, asset price inflation in Asia and UK ( from Asian investors) and the bullish equities indicate that the QE2 withdrawal will spin out to scale though over an extended period. Markets therefore wreaked havoc on the us Bonds again, driving yields north of 2.64% on the 10 Y bond and definitely impacting mortgage rates in the second half of the month after a brief respite.
Housing data found it easy enough to maintain year / year growth even in detailed city wise price indices from the Case Schiller report. The change in Employment however was almost totally driven by 240k Job market participants who got tred of being counted ( the buzzer rings at the end of 27 months of unemployment) and fell off the rolls. The 162,000 jobs created this July still portend a good enough average to keep unemployment from rising and apparently news of the construction sector picking up is in the air.
Obama bought a lot of goodwill from Apple Inc by nodding to their indiscretions on the Samsung patents they were caught in bed with, and Samsung was hurt correspondingly in Global markets mini flash crashes in highly liquid visible scrips still commonplace even as he erstwhile identified villain in High Frequency Trading gave way in 2011 itself, cutting on volumes. Dark pools too have since been trying to curry favor with more participants without success though low buy or high sell quotes can probably still be found in these markets on every listing worth owning
HSBC earnings made the stock take a 4% hit though the bank performed top of the dollar for the quarter and has coasted into a stable business and growth ode after selling off more than 50 underperforming businesses and delivering cost rationalisation that will again exceed $1 Bln this year conservatively. Stanchart follows tomorrow mirroring the same markets and businesses. We are busy studying, so attend that set of con calls yourself and write back to us with the highlights..Lloyds and Barclays are coinciding on rights and public issue offers while socgen also improved results in its corner of the world having rid itself of its toxic contributions since 2010
Tomorrow is global reorts of industrial production data(Europe0 , Wednesday Emerging markets data including India and Brazil with more retail sales data for July spread throughout the week and Chinese data towards the end of the week. Stay tuned.