NYSE MAC Desk
Market Update

Good morning,
 
After back-to-back failed selloff attempts, US equity markets rallied yesterday with the S&P 500 ending up 1.1%, closing at a new YTD high (5.8%). The index is now within 1% of the December high (~4,100). Following an evening of mixed earnings reports futures were modestly lower overnight and there has been very little reaction to this morning’s economic data. S&P futures are currently trading ~0.35% below fair-value. Asian markets ended modestly higher overnight, with the exception of India, which is still dealing with the fallout of the short report related to the Adani Group. European indices traded slightly higher after the open but have pulled back to around unchanged. There was some potentially impactful economic data this morning, but the numbers were largely inline. Personal income was in line at 0.2%, a deceleration from last month (0.4%). Personal spending fell a touch more than expected (-0.2% vs. -0.1%). The inflation data was pretty much spot on. While the annual numbers show significant declines, monthly core-PCE ticked up very modestly (0.3% prior 0.2%). US yields were higher overnight, they did initially pullback after the data but are back to where they were prior up ~4bps across the curve. The US dollar index continues to bounce between the YTD low (~101.25) and ~102, currently up 0.25% to ~101.90. After the open final U of Mich. Sentiment and pending home sales will be released. ICE Brent is up ~1.5% to ~88.80 just under the YTD high. Most metals markets are pulling back modestly but really just continue to consolidate the gains from earlier in the year.
 
Quickly touching on the earnings there were a couple of disappointing reports in the semis (INTC & KLAC both off >5%). Meanwhile Visa (+1%) and American Express (+7%) both put up solid results highlighting resilient consumer spending especially related to travel.
 
Europe
STOXX Europe 600: UNCH (+0.4% week-to-date)
Germany's DAX: -0.2% (+0.4% week-to-date)
U.K.'s FTSE 100: UNCH (-0.1% week-to-date)
France's CAC 40: -0.2%(+1.2% week-to-date)
Italy's FTSE MIB: +0.3% (+2.1% week-to-date)
Spain's IBEX 35: -0.1% (+1.2% week-to-date)
Asia
Japan's Nikkei: +0.1% (+3.1% for the week)
Hong Kong's Hang Seng: +0.5% (+2.9% for the week)
China's Shanghai Composite: CLOSED (UNCH for the week)
India's Sensex: -1.5% (-2.1% for the week)
South Korea's Kospi: +0.6% (+3.7% for the week)
Australia's ASX All Ordinaries: +0.3% (+0.6% for the week)
 
Other Asset Classes:

• US - 2yr +3bps to 4.211%, 5yr +5bps to 3.634%, 10yr +5bps to 3.539%, 30yr +4bps to 3.663%
• USD index: +$0.28 to $101.92
• Oil prices - ICE Brent: +1.53% to $88.81, WTI: +1.60% to $82.31, Nat Gas: -1.79% to $2.80
• Gold: -0.17% to $1,926.70, Silver: -1.67% to $23.62, Copper: -0.46% to $4.25
• Wheat: -0.90% to $8.57, Corn: -0.37% to $6.80, Cotton: -1.03% to $0.87
• VIX: +0.06 to 18.79
• Bitcoin: -0.8% to ~22.9k

Other News:

• House GOP leaders consider extending the debt ceiling to 9/30 - Bloomberg
• WSJ highlights that nearly 7% of daily options trading on a daily basis is coming from Tesla

China:

• Japan and Netherlands join US in export controls on semiconductor equipment - Bloomberg

Economic Data:  

• US:
  • Personal income: 0.2% vs. 0.2% cons., prior 0.4%
  • Personal spending: -0.2% vs. -0.1% cons., prior revised to -0.1% from 0.1%
  • PCE: 0.1%/5.0% m.m/y.y vs. 0%/5.0% cons., prior 0.1%/5.5%
  • Core-PCE: 0.3%/4.4% m.m/y.y vs. 0.3%/4.4% cons., prior 0.2%/4.7%
  • 10:00 U of Mich Sentiment (final): prior 64.6 (Inflation Expectations)
• Global:
  • Tokyo CPI: 4.4% prior 3.9%
  • Australia export prices: -0.9% q/q vs. -1.6% cons., prior -3.6%
  • Australia import prices: 1.8% q/q prior 3.0%
  • Eurozone M3: 4.1% vs. 4.6% cons., prior 4.8%