The weak November HSBC PMI for China has added to market bearishness. This is not the official PMI but we do note that while the HSBC measure has been below 50 for 4 of the 5 past months, the official PMI has yet to fall below 50, but it was reported at 50.4 in October, the lowest since February 2009. A further drop in the official PMI below 50 seems hard to avoid. Slowing in the Chinese economy is inevitable given the deteriorating external environment as well as PBOC tightening measures taken in 2010-2011.Read more ›
Post Tagged with: "economic data"
What was to be a subdued period in the markets is turning into a rout. There have been a number of poor developments that have sent the US dollar broadly higher and has weighed on the highly correlated risk assets, equities, emerging market and commodities.Read more ›
Brazil stands out now for being one of the few in EM to be cutting rates. We think most in EM will be cutting rates by Q1 2012 due to the deteriorating global growth outlook, and so BRL will still likely continue to enjoy a big yield advantage over other EM currencies next year. The current account and budget deficits remain very manageable, with inflows of FDI more than covering the former. There are many reasons to remain constructive on BRL, but the DM story unfolding suggests that we are months away from clear sailing for EM.Read more ›
The European sovereign debt crisis is rapidly approaching what could be a significant tipping point as it threatens to spread to the heart of Europe. In recent days Italian 10-year bond yields have soared to 7.22% and today Spain was forced to pay 6.975% at its auction. Even French 10-year yields have climbed to 3.71%, its widest spread over German bond yields since the Euro Zone was started. All of this has happened despite large ECB purchases of periphery country bonds over the last few months and the installation of technocratic governments in Greece and Italy.
The fear has now spread to the heart of Europe.Read more ›
EuroStoxx 600 is down over 1%, EZ bond yields mostly higher after Spanish and French bond auctions. Financial market stress (banking and credit) continues to intensify amid lack of progress on debt crisis. UK October retail sales saw unexpected strength; Singapore’s Oct. non-oil domestic exports plunged.Read more ›
Risk aversion continues to weigh heavily on equity markets and EZ sovereigns; Dollar mostly firmer across the board. EZ policy developments remain in spotlight with growth expected to slow; UK inflation moderates. In the North American session US data comes into focus; Singapore retails sales likely bellwether for Asian growth.Read more ›
Markets failed to get a lasting boost from change in EZ governments; dollar broadly higher into open. Italy auction met with decent response, but higher yields nonetheless ; change in governments no panacea in EZ. Japan’s preliminary Q3 marks the end of the recession; Hungarian forint weakest currency on the day.Read more ›
David Rosenberg recently spoke to WealthTrack’s Consuelo Mack about prospects for the US economy. Rosenberg believes that upside to US economic growth will continue to be constrained by high levels of debt. Despite historic levels of fiscal and monetary stimulus, “no major economic indicator that measure the economy from employment to GDP to industrial production to real incomes has managed to get back to their prior cycle highs in late 2007″, notes Rosenberg. He believes that we are in a depression.
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Markets have shifted back to crisis mode amid uncertainty over Italian economic reforms. Three likely scenarios remain after Berlusconi’s upcoming departure; Italian 10-year above 7%. UK September trade data unexpectedly widened, on imports; China’s October CPI eases.Read more ›
Great data from from the BLS. The average annual wage in New York’s financial industry more than tripled from 1990 to 2009.Read more ›
A breakdown of Friday’s numbers with net loss and gain by key industry.Read more ›