OVERNIGHT MARKETS AND NEWS
Sep E-mini S&Ps (ESU17 +0.04%) this morning are little changed, down -0.03% as a Category 5 Hurricane Irma races through the Caribbean toward Florida. European stocks are down -0.16% at a 1-week low after German Jul factory orders unexpectedly declined. North Korean tensions continue to simmer with a lack of consensus among the U.S., Russia and China on how to pressure North Korea to give up its nuclear ambitions as Russia and China both oppose calls from the U.S. for additional sanctions against the North Korean regime. A +0.39% rally in Oct WTI crude oil (CLV17 +0.86%) to a 3-week high is limiting losses in stock indexes as energy stocks move higher. Asian stocks settled mostly lower: Japan -0.14%, Hong Kong -0.46%, China +0.03%, Taiwan -0.66%, Australia -0.29%, Singapore -0.58%, South Korea -0.29%, India -0.46%. A rally in commodity and energy producing stocks helped China’s Shanghai Composite eke out a slight gain and post a new 1-1/2 year high, while a slide in USD/JPY to a 1-week low undercut Japanese exporter stocks and helped drag the Nikkei Stock Index down to a fresh 4-month low.
The dollar index (DXY00 +0.04%) is up +0.01%, although the upside was muted after Dallas Fed President Kaplan said the Fed should be “patient” on raising interest rates for a third time this year due to slow inflation. EUR/USD (^EURUSD) is up +0.11%. USD/JPY (^USDJPY) is up +0.06% as it recovers from a 1-week low in overnight trade.
Dec 10-year T-note prices (ZNZ17 -0.04%) are down -1 tick.
Dallas Fed President Kaplan said the Fed should be “patient” on raising interest rates for a third time this year as inflation has been slow to respond to a labor market that’s nearing full employment.
German Jul factory orders unexpectedly fell -0.7% m/m, weaker than expectations of +0.2% m/m.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Weekly MBA mortgage applications, (2) Jul trade balance (expected -$44.7 billion), (3) Revised Aug Markit services PMI (prelim-Aug +2.2 to 56.9), (4) Aug ISM non-manufacturing PMI (expected +1.6 to 55.5), (5) Fed Beige Book.
Notable Russell 1000 earnings reports today include: HD Supply Holdings (consensus $0.64), Casey’s General Stores $1.44, Guidewire Software $0.39..
U.S. IPO’s scheduled to price today: Matlin and Partners Acquisition Corp. and Presidio.
