parmveer.sunnar's picture

Trending Economic: Morning Brief [08 October 15]

Markets have been relatively quiet overnight; however there are a number of high impact data releases due out today. It is also the case that China has returned from its week long holiday. Of course this means that Chinese markets have re-opened and overnight Chinese stocks have rallied aggressively as the Shanghai Composite index is up around 3.8%, outperforming its major counterparts. This is mainly being attributed to China playing catch up with other global stock markets (due to the closure). In terms of US markets, the S&P 500 index rallied to 3 week highs, largely on the back of strength in the biotech sector.  Importantly today sees the release of unemployment claims, (1230GMT) with expectations of a release around 274K vs. 277K exp.  FOMC meeting minutes will be released at 1800GMT and FOMC Member Williams will speak at 1930GMT, markets are seeking more clarification on where the FED now stands especially considering last weeks lack lustre employment data. It must be noted that many recent speeches by Fed members have downplayed the weak employment data, indicating that the Fed is on the path for a 2015 rate hike.

There is a plethora of Mon-Pol out today from the UK, due out at 1100GMT, specifically we wills see the release of MPC Official Bank Rate Votes, Mon-Pol Summary, Official Bank Rate, Asset Purchase Facility and MPC Asset Purchase Facility Votes.  No change is expected in interest rates however the possibility exists for votes to change from 8-1 to 8-2 in favour of no change in rates.  BOE Governor Carney is also set to speak at 1800GMT.

In the commodity space, Oil yesterday fell aggressively following the release of inventory data which came in at 3.1M vs 2.2M exp, this comes after a 5% rise earlier in the week, extending worries of increasing supply. The market is currently being supported around the $47.80 level with price action largely sideways.