Wednesday, November 20, 2013

Morning Memo: Wednesday, November 20, 2013

ICYMI...yesterday's post re Fixed Income Markets: 

Investor Update: Fixed Income Market Commentary

"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...mixed session with China and Hong Kong continuing to rally on anticipated reforms, while Japan's Nikkei slipped on disappointing trade data showing a much larger increase in imports, thereby pushing the trade deficit higher.
  • Japan...Trade Deficit larger than expected subtracts from GDP growth.  The weaker Yen this year (currently at four-year low vs the Euro) has helped exports surge, but has also raised the costs of imports, which continues to expand the overall trade deficit.  Bulls viewed the number as evidence of a strong domestic economy and sited that much of the import bill comes from imported oil.
  • OECD...cuts growth forecasts for '14 slightly.
  • Bernanke...late yesterday said that US rates could stay near zero even beyond hitting the unemployment metric target of 6.5%.  While that could have subdued early 'tapering' fears, markets remain on edge ahead of today's release of the minutes from October's FOMC meeting where the focus will be on what was said re tapering timing.
  • EM...most currency and bond markets are softer ahead of the FOMC minutes.  So-called 'risk currencies' such as the AUD, South African Rand and India Rupee were all weaker.
  • Europe...flat to lower ahead of US data and FOMC minutes release.
  • UK...BoE minutes from last meeting showed unanimous agreement on keeping rates and QE as is and that none of their metrics had been reached to alter 'guidance'.
  • US...upcoming data: Retail Sales, CPI, and Existing Home Sales.
  • Editorial note:  The Fed....On Monday, Fed Gov Plosser suggested an idea that the QE program should have a dollar limit as to how much the Fed can buy.  Then yesterday, another Fed Gov suggested an actual amount.  This might have been behind the selloff in US Treasuries yesterday despite weaker outlooks from several companies and lowering of growth forecasts globally by the OECD.
  • Also, of interest:  worth considering while anticipating consumer activity in coming weeks:
  • more later....
Please continue to visit Soos Global Market Musings for updates.

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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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