Thursday, December 5, 2013

Morning Memo: Thursday, December 5, 2013 UPDATED

"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...
  • Here's what Asia opened up to:  news that US economic data was, on balance, stronger than expected, therefore tapering fears were heightened, therefore the DOW sold off: 
  • Asia...with renewed concerns about US Fed "Tapering" ahead of Friday's Non-Farm Payroll  number, most of Asia saw equity markets turn lower.  The USD came off recent highs, so with Yen strength, the Nikkei fell 1.5%.  This also likely reflected profit-taking as we head towards year-end, given that the Nikkei is up close to 50% YTD.
  • India...one of the few markets trading higher (1.7%) on reports that the opposition political party is looking likely to win State elections whose results will be announced on Sunday.  The opposition party is viewed as being more business friendly and is expected to do more to improve the economy and infrastructure.
  • Indonesia...equity market hits three-month low as the Rupiah weakens further.
  • Europe...opened slightly lower, but is tentative ahead of ECB and Bk of England meetings today.
  • Germany...more evidence of an expanding German economy came from Markit's Construction PMI today:
  • Europe...Manufacturing data from Markit...

  • Spain....Yesterday, Moody's raised the credit outlook to 'stable' from 'negative', citing progress on fiscal situation, less risk of contagion and improved access to credit markets. (S&P did the same thing last week).
  • Of interest:
    • The Moody's Analytics "Dismal Scientist" blog provides a good global overview in the article linked below.  They're outlook for 2014 is a 'subdued positive' with 'downside risks'.  After reading it, however, I wonder if the weightings ought to be reversed: "downside outlook" with "subdued positive risks"....Your thoughts???
  • more later....
  • LATER:
    • US..Jobless Claims better than expected, drop below 300k to 298k!
    • US..Q3 GDP revised up to 3.6%, igniting more fears of a sooner 'tapering'!  Much of the increase, however, was driven by inventory builds that could prove short-lived and could dampen Q4 growth.
    • ECB...left rates unched, lowered inflation forecasts, but Draghi did not signal any change in current policy which some had expected  in response to recent lower inflation readings.
    • Bk of England...leaves rates unched.

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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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