Trading with point and figure

Dentalfloss · Jul 8, 2019

Dentalfloss · Jul 8, 2019

DAX todaay

Dentalfloss · Jul 8, 2019

Eurusd in support
Powell tomorrow 1.45pm

Dentalfloss · Jul 8, 2019

IN rez

Dentalfloss · Jul 8, 2019

12500 broken
watch to see if its rez on any bounce=weakness

Dentalfloss · Jul 8, 2019

Dentalfloss · Jul 8, 2019

Dentalfloss · Jul 8, 2019

Dentalfloss · Jul 9, 2019

Mornin folks ☕ ☕ ☕ ☕ ☕ ☕

💋💋💋💋💋

Dentalfloss · Jul 9, 2019

Dentalfloss · Jul 9, 2019

Good Morning: The Long & the Short of it and The Bigger Picture - 9 July 2019 - ADM ISI

Inbox

x

Ostwald, Marc

08:33 (13 minutes ago)

to Marc

- Digesting UK BRC Retail Sales, Japan Wages and Norway monthly GDP;
awaiting Italy Retail Sales, US NFIB survey and JOLTS Job Openings;
Eurogroup meeting, plus Fed speaks from Powell, Quarles, Bullard and
Bostic; Germany to sell I-L Bunds and US offers 3-yr UST;

- UK BRC Sales: adverse base effects continuing to weigh, but underlying
trend still clearly weak

- Japan Wages: still contracting, even if less than expected; fall in
regular pay underlines tight labour market still not a recipe for
wage growth

- Norway GDP: once again beating forecasts, and once again affirming
Norges Bank's tightening policy stance

- US NFIB & JOLTS: NFIB seen dipping, but still running at solid levels;
JOLTS Job Openings seen confirming May Payrolls as quirky outlier

- Charts: Iron Ore future price and Volatility; US 10-yr yield, US IG and
HY Credit spreads, JPM EMBI EM yield spread

- Audio preview:
https://www.mixcloud.com/MOstwaldADM/adm-isi-morning-call-9-july-2019/

..........................................................................

********************
** EVENTS PREVIEW **
********************

The day's schedule looks to be a little short on major market movers, either statistically or in event terms. There are the overnight Japanese Labour Cash Earnings, UK BRC Retail Sales and monthly Norwegian GDP to digest, while ahead lie US NFIB Small Business Optimism and JOLTS Job Opening along with Mexican CPI. There is a goodly volume of Fed speak, though it is Powell's testimony tomorrow and Thursday which will attract more attention than the bank 'stress testing' conference at which he and Quarles speak today, even if one is mindful that 'undergoing major restructuring' Deutsche Bank passed this year's Fed's tests raised a few eyebrows. There should be rather more in the way of monetary policy relevant comments from Bullard and Bostic at the OMFIF conference. Otherwise Malaysia's BNM is seen holding rates at 3.0%; BNM has indeed kept rates at either 3.0 or 3.25% since May 2011, having cut 25 bps to 3.0% in May. The earnings schedule has a couple of very specific points of interest via of India's Tata Consultancy Services, UK online retailer Ocado, the recently IPOed Levi Strauss and beverage behemoth Pepsico. Govt debt sales see the usual tiny offerings of 4 & 11-yr German inflation-Linked Bunds, while the US kicks off this week's coupon sales with
$38 Bln of 3-yr.

* Overnight data review *
- Japan's Labour Cash Earnings were mixed, better than expected tat -0.2% y/y nominal (vs. April -0.3%, expected -0.6%) and in real terms at -1.0% (vs. April -0.4%, expected -1.5%), but with Regular Pay falling 0.6% y/y, while Special Payments rose 2.5% y/y, the obvious conclusion is that even with a super tight labour market, there is no sign of any meaningful wage inflation emerging whatsoever. UK BRC Retail Sales were worse than expected at -1.6% y/y in like for like terms, and while the base effects from last year's Royal Wedding and World Cup "sugar rush" are clearly adverse, the profile of consumer spending remains weak, and by extension, prospects for Q2 GDP rather dim. Elsewhere, Norway continues to shine amid the economic cloud of doom that hangs over Europe, with Mainland GDP coming at 0.3% m/m vs. expectations of 0.1% m/m, and an upwardly revised 0.4% for April, per se reinforcing Norges Bank's rather lonely hawkish stance.

** U.S.A. - June NFIB Small Business Optimism / May JOLTS Job Openings **
- Last month's NFIB defied the broad swathe of weaker US surveys that have been seen in the past 4 to 6 weeks, picking up to a 7 month high of 105.0, though it is expected to slip back to 103.3 in today's report, close to April's reading. The already published Employment component of the survey saw the Plan To Hire measure dip to 19%, but still bang in the middle of the 6 month range, though it did see a sharper drop in the Net Compensation index from 34% to 28%, the lowest since Dec-2017. While the regional Fed surveys were gloomy, and the ADP survey suggested Small businesses were not hiring for a second month, both ISM surveys at the headline level continued to suggest the loss of momentum in the economy has been modest, per see fitting with the consensus. Friday's stronger than expected labour data effectively confirmed that the May weakness was an aberration rather than a trend, and as such the JOLTS Job Openings for May should be somewhere around the level of the past two months at 7.473 Mln as the median forecast assumes, which in turn is still only modestly lower than November's all-time high of 7.626 Mln. The challenge for Mr Powell tomorrow and Thursday is to find a way of deflating market rate cut expectations without prompting a sharp sell-off in equities, rates and credit - a challenge which one would have to observe is a rod that the FOMC has created to beat itself, which a little more circumspection might have avoided (regardless of Trump ranting and raving on a topic which he understands little or nothing about).