Morning Memo: Monday, September 23, 2013

"Morning Memo" begins below this "NOTE for  NEWCOMERS" to "Morning Memo"...... Each morning, we post a short bullet-point list of noteworthy events, data, etc that find their way into the assessment of global markets.  It's far from complete and is not meant to be an exhaustive reconciliation of all things that could possibly impact stocks, bonds, currencies and commodities!  Rather, it's best viewed as a cryptic memo of "highlights", noteworthy items that took place in Asia, European and US hours.....and color-coded 'Red' for seemingly negative impact on equity markets, 'Green' for positive.
This will also serve as a useful review mechanism, as scrolling through the series of "Morning Memo" posts over time ought to summarily highlight what generally drove price action.  
We hope you find this useful and informative....and as always, that you'll share feedback!!
5:15am ET...

•  Note:  last week was a "tale of many cities" for the equity markets.  
• The week started off with exuberance on the hawkish Larry Summers stepping out of the picture, leaving Janet Yellen, seemingly more dovish, as the likely next Fed Gov, and less likely to taper imminently.  
• Then Russia and the US reached some kind of accord re Syria's chemical weapons.  
• Tuesday was calm ahead of Wednesday's FOMC accouncement as the market still anticipated a $10-15B taper.
• The Fed's move NOT to taper at all at this time sent the dollar lower, commodities higher, equities higher, bond yields lower and emerging market currencies higher.
• Then came some sobriety on Thursday, and lots more on Friday (Dow down 185 pts) when economic data came in stronger than expected (Jobless Claims, New Home Sales, and Trade Deficit).  
• Fed Governors' speeches late in the week also pushed equity markets lower on hints that tapering might be possible as early as the October FOMC meeting.
• Debt ceiling and budget noise out of Washington was another negative catalyst for equity markets.
• Finally, in a sign that emerging nations are not fully out of the woods as it relates to their currencies, India surprised with a rate hike in defense of the Rupee.
• Weekend...
• the tragedy in Kenya continues, with scores dead, and the terror risk once again flashing more fiercely on investor radar screens.
• Germany...Angela Merkel's Christian Democrats wins the election, but falls short of an absolute majority, leaving her in search of a coalition partner.  This leaves Merkel possibly trying to form a coalition w/the center-left party who came in second, the Social Democrats, who share similar pro-Euro views as Merkel.  The anti-Euro party did score well, however, in a reminder of the tensions within Germany and across Europe related to austerity, bail-outs, etc. 
• China...HSBC prelim manufacturing PMI for September stronger than expected @ 51.2, up from 50.1 in Aug.  Shanghai market rallies, after having been closed late last week.
• Asia...overall lower session across Asia on the heels of last Friday's US selloff.
• Europe.... Markit Composite PMI for the Eurozone is at 27-mth high, with particular help from the services sector, while manufacturing slipped to a 2-mth low of 51.1 (so still >50 which means expanding, but at a slower pace).  Markets, after opening lower, have turned up on the PMI news.
• more later...

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