US stock future indexes are lower this morning (SPY -0.1%) after the Pound took a 9% nosedive and the unemployment rate rose to 5.0%. (see full morning report below) Crude Prices pushing higher into the $50 handle, the US dollar is testing actively its resistance and gold is trading at its support.
Here is the current market situation from CNN Money
European markets are mixed. The FTSE 100 is higher by 0.82%, while the CAC 40 is leading the DAX lower. They are down 0.40% and 0.31% respectively.
Looking at the last three columns, the first one (Actual), is what was reported this morning. The second column (Forecast) is what analysts had forecast and the third column is the previous report. Full calendar HERE.
DOHA/FRANKFURT (Reuters) - Qatari investors who own the largest stake in Deutsche Bank do not plan to sell their shares and could consider buying more if the embattled German bank decides to raise capital, sources familiar with Qatari investment policy told Reuters.
LONDON (Reuters) - Sterling lost a tenth of its value in minutes on Friday, in what traders said was a "flash crash" driven by computer-initiated sell orders that left the pound at a fresh 31-year-low and heading for its worst week since January 2009.
LONDON (Reuters) - Sterling recouped some losses after plunging almost 10 percent on Friday, as growing fears of a "hard" exit by Britain from the European Union sent a shiver through world stocks markets before U.S. jobs data.
(Reuters) - Photo-sharing app Snapchat's parent is working on an initial public offering that could value the company at $25 billion or more, the Wall Street Journal reported, citing several people familiar with the matter.
WASHINGTON (Reuters) - World finance leaders on Thursday decried a growing populist backlash against globalization and pledged to take steps to ensure trade and economic integration benefited more people currently left behind.
Today's biggest story was supposed to be the September payrolls; instead courtesy of a few wild algos, a fat finger, or a deliberate attack on sterling during the most illiquid time in the day, it was the 6% "pounding", as sterling tumbled dramatically in chaotic trading that included a flash, 2 minute drop in early Asian hours and sustained falls in London. By morning it had managed to recoup much of its losses however the selling pressure has continued and the currency appears unable to regain all of its losses as would have been the case if this was a mere "fat finger."
The sharp drop in illiquid Asian trading came amid worries about the U.K.'s "hard exit" from the EU, accelerated by computerized trades. The pound fell more than 6% just after 7 a.m. Hong Kong time on Friday to as low as $1.1819 from just above $1.26, before recovering above $1.24, according to Thomson Reuters data. But it took another dive in London hours and was down to just over $1.23.
But more interesting even than the drop itself, were Wall Street's reactions to the "pounding", and none was more indicative than that of Kenji Yoshii, a foreign exchange strategist at Mizuho Securities, who told WSJ that "I initially doubted what I saw on my screen."
Here are some other notable quotes from stunned market participants:
"This is not something you would expect in a half-efficient market," said Ul ...
The distribution of guesses for tomorrow's "most important payrolls print ever" or at least until next month, skews modestly to the upside after the biggest spike in ISM employment ever this week jarred some economists to become more optimistic, and side with Goldman Sachs expecting a Fed-inspiring drop in the unemployment rate, rise in average hourly earnings, and better than expected payrolls of 190K. As a result, while consensus expects a NFP rebound from 151K to 172K, the whisper number is around 200k. Anything above this would send December rate hike odds surging to the all important 70% or above, bond yields spiking and equities at the mercy of whichever way the risk parity machines were calibrated tomorrow.
Others disagree: Southbay Research is leaning on the bearish side, nothing the following positive and negative factors ahead of tomorrow's report:
ISM Non-Mftg: Surges to 57.1 from 51.4
ISM Mftg: Up to 51.5 from 49.4
PMI Services: Up to 52.3 from 51
Chicago PMI: Up 54.2 from 51.5
ADP: Payrolls drop (Forecast September 155K)
PMI Mftng: Slips to 51.5 from 52
Construction: drops -0.7% versus -0.3% prior month
Corporate Profits 2Q: -1.7% y/y versus -2.2% prior quarter
Durable Goods Orders (ex Trans): -0.4%
ISM Non-Mftg: Employment Index surges to 57.2 from 50.7
ISM Mftg: Employment Index ticks up to 49.7 from 48.3
PMI Services: Weakest employment levels in 4.5 years
PMI Mftg: Employment consistent with 115K jobs
It is worth noting that conflicting data is the hallmark of inflection points. Furthermore, as Southbay notes, "Forget Manufacturing, Focus on Services." Here is the full bearish case:
Last October, about 6 months after the New York Times first revealed the existence of the Hillary Clinton private email server, President Obama appeared on "60 Minutes" and denied any and all knowledge of her potentially illegal technology arrangements. When asked point blank whether he knew about Hillary's private email server, Obama responded, quite simply, "No."
Of course, we now know from the FBI's investigation notes that, in fact, that was a complete lie. As we noted back in September, Huma Abedin's interview with the FBI on April 5, 2016 revealed an email sent on June 28, 2012 from Obama, using an unknown pseudonym, to Hillary on her private email server. So, either Obama is so incompetent that he didn't recognize that Hillary wasn't using a ".gov" email account or he simply lied in the following interview. We'll let you be the judge.
But now, per a report last night from the Wall Street Journal, we know that, not only did the Obama administration know about Hillary's private email server they actually conspired, along with the State Department, to cover it up. New emails, obtained by the Wall Street Journal via a FOIA request by the Republican National Committee, reveal communications between the White House and the State Department coordinating over how to minimize the potential fallout from Hillary's email scandal so as to not impact her nascent presidential campaign.&nb ...
Week 39 of 2016 shows same week total rail traffic (from same week one year ago) contracted according to the Association of American Railroads (AAR) traffic data. However, the data was marginally better compared to last week.
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