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TradeTheNews.com US Market Update: Summers Departure Sparks Global Equity Rally
US Market Update: Summers Departure Sparks Global Equity Rally
Mon, 16 Sep 2013 11:02 AM EST
- (IL) Israel Aug Trade Balance: -$1.5B v -$2.0B prior
- (IL) Israel Q2 Preliminary GDP Annualized: 4.9% v 4.5%e
- (BR) Brazil Sept FGV Inflation IGP-10 M/M: 1.1% v 0.9%e
- (PL) Poland Aug CPI Core M/M: -0.1% v -0.1%e; Y/Y: 1.4% v 1.4%e
- (US) Sept Empire Manufacturing: 6.29
- (CA) Canada July Int'l Securities Transactions: C$6.1B v C$8.0Be
- (PL) Poland Aug YTD Budget Balance: Level (PLN): -26.8B v -25.9B prior
- (BE) Belgium July Trade Balance: €2.05B v €619.3M prior
- (CA) Canada Aug Existing Home Sales M/M: 2.8% v 0.2% prior
- (US) Aug Industrial Production M/M:
0.4% v 0.4%e; Capacity Utilization: 77.8% v 77.9%e; Manufacturing Production:
0.7% v 0.4%e
- Global equity markets are rallying hard in Monday trade after Larry Summers
removed himself from the running for Fed chairman. As of writing, the DJIA is
up 1%, the S&P500 is up 0.82% and the Nasdaq is up 0.27%.
- The August industrial production
report showed a return to incremental gains for US factories after July's flat
reading. Commentators said the bounce back likely reflects robust auto sector
demand. Note that the September Empire Manufacturing survey suggests
factories in NY state have pulled back from levels seen over the summer months.
- The US media have been engaged in a frenzy of speculation since the
withdrawal of Larry Summers from consideration for Fed chairman last Friday. The money is now on Janet Yellen as basically
a shoe-in for the position, although there is talk that former Fed vice
chairman Donald Kohn could be a dark horse candidate. In a speech this
morning, easy monetary policy creates potentially dangerous risks. Note that
the UST 10-year yield has reversed quickly, down around 10 bps to approx.
- Steady progress is being made in bringing together all sides on the Syria
issue, with Damascus already submitting the requisite paperwork and details of
the pact being quickly worked out among Russia, the US, the UK and France. UN
inspectors are presenting their report on August attack this morning.
Front-month WTI crude is down to the $106 handle.
- There has been a variety of acquisition and divestment deals announced this
morning. The largest deal is for paper
manufacturer Boise, Inc to be acquired by Packaging Corporation of America for
$12.55/shr in cash, in a total deal valued at approximately $2.0B.
Packaging Corp said the deal would be accretive immediately. Competitor
KapStone Paper is up 6% on the deal. Shares of ATI are up 10% or so after the
firm sold off its tungsten materials business to Kennametal for $605M.
- Among other movers, there is talk that Blyth's 10% gain this morning is a big
short squeeze. Note that approximately 70% of the firm's float is short. Major
US homebuilders are all up 4-5% a piece this morning as markets rally, thanks
to lower rates and hopes for looser Fed policy over the medium term.
- 11:30 (US) Treasury to sell combined $55B in 3-Month and 6-Month Bills
- 21:30 (AU) RBA Policy Meeting - September Minutes
- 21:30 (AU) RBA Sept Policy Minutes
- (PE) Peru July Economic Activity Y/Y: No est v 4.4% prior
- (PE) Peru Aug Unemployment Rate: No est v 6.0% prior
- (BR) Brazil Aug Tax Collections (BRL): No est v 94.3B prior
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