Tuesday, October 29, 2013

Morning Memo: Tuesday, October 29, 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!!

5:00am ET...
  • Asia...after mixed data yesterday in the US (worse than expected Pending Home Sales, but slightly better than expected Industrial Production and Capacity Utilization), and ahead of tomorrow's Fed FOMC meeting conclusion, markets were mixed in a cautious mode.
  • India...raised rates by .25% to 7.75%, aimed at fighting inflation. This was expected, and was greeted well by equity markets.  Seen as a sign of stabilizing the fundamental economic picture, taking rising inflation expectations down a few notches, and coupled with other forms of easing to promote growth, these moves by new RBI Gov Rajan have bolstered confidence in equity markets.
  • Australia....Central bank Gov Stevens told a conference that he expects the AUD to fall from its recent highs as commodity based export prices fall and overall demand in the sector declines.  The higher AUD has raised concerns of snuffing out non-commodity based exports.
  • China..recent fears of a repeat of last June's liquidity drain and rate spike were calmed today when the central bank added liquidity to the market.  At the same time, the central bank set one week rates slightly higher, indicating a bit of monetary tightening, but in a more controlled way. 
  • Europe....mixed cautious opening as earnings dominate the news.  Banks in particular have reported underwhelming results, offset by strength in some energy companies
  • US...Fed starts two-day FOMC meeting today.
  • more later... 
  • Later
    • Retail Sales..drops 0.1% in Sept, worse than forecast of unched.  Ex autos inline.  See CalculatedRiskBlog

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(Please note: This article is solely meant to be thought provoking and is not in any way meant to be personal investment advice. Each investor is obligated to opine and decide for themselves as to the appropriateness of anything said in this article to their unique financial profile, risk tolerances and portfolio goals).
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