US Opening Comments
European equities have rebounded from earlier losses spurred on by higher than expected Eurozone CPI at 4.1% and a larger than expected decline in UK housing prices which slipped 1.7% M-o-M. Poor earnings from Unilever and French pharmaceutical giant, Sanofi also contributed to Europe’s rough start. Nonetheless, the Dax is now up 0.5% and the FTSE is up 0.25%. Asian equities finished narrowly higher while US futures are pointing toward a higher start as DOW Futures are near flat while S&P’s and Nasdaq’s are up over 0.1%. Strong earnings report this morning from Disney, Altria, Motorola, and Visa are helping buoy equities.
US treasuries are near flat while the yields on both the 10yr Gilt and Bund are up 1 bp.
Crude is off by more than 0.5% to just above 125 while metals are well bid with Gold up nearly 1%. The USD is mixed gaining against JPY while losing nearly 35 pips to the EUR this as Cable is holding near flat.
The Advance report of Q2 GDP will be released this morning at 8:30am EST where expectations are for a revision to 2.3% from the prior reading of 1.0%. Personal consumption is expected at 1.7% versus a prior of 1.1%, the GDP Price Index at 2.4% after a prior of 2.7%, and Core PCE is expected at 2.0% versus a prior of 2.3%. Also at 8:30am is Initial Jobless Claims where the consensus is 393k after last week’s 406k and the Q2 Employment Cost Index which is expected to be unchanged at 0.7%. At 9:45, the July NAPM Chicago report is out with consensus at 49 against a prior of 49.6. Shortly after at 10:00, NAPM Milwaukee is out where an increase to 43.5 from 39 is expected. Then at 10:30 EIA Natural Gas Storage data is out where a build of 70 bcf is consensus. This afternoon at 3:30pm TSY Sec. Paulson will be speaking in regards to the US economy.