Key News
*Australia Shares End Up 1.6% On Strong GDP Data (WSJ)
* European Spending, Exports Decline Most in 14 Years (Bloomberg)
*Euro zone Q1 GDP shrinks on inventories, investment (Reuters)
The Event Agenda
The Morning Run-Down
This morning the dollar is stronger, stocks lower, Treasuries higher and commodities slightly lower. The dollar is getting relief on weaker than expected data out of Europe. Consumer spending and exports contracted the most in “at least 14 years” according to Bloomberg. This combines with the bigger than expected rise in unemployment to 9.2% released yesterday and softer GDP this morning. Also yesterday, we had a look at Switzerland’s Q1 GDP. The economy is shrinking by the most in 15 years.
Paul Volcker said yesterday that a full US recovery is years away. Considering sentiment has been THE driver of this retracement in asset prices, be aware of negative sentiment creeping back in.
Employment data is a big focus going into the end of the week. Today we get somewhat of a gauge with ADP, which came in a bit worse than expected. Tomorrow jobless claims and then payrolls and the unemployment rate on Friday.
We also have interest rate decisions out of the BOE and ECB tomorrow. Both should be unchanged, but the focus will be on the Trichet press conference again for indications on quantitative easing plans.
Yesterday’s tighter range in the S&P 500 makes an outside range today (a potential reversal signal assuming a weak close) likely. Global stocks are leading the way lower this morning, as analysts are beginning to chatter about over valuation.
Key Charts
The dollar index tested and held key support of the entire move off of the March highs. Today the sharp move of the last four trading days in currencies is breaking down.
Related posts:
- Morning Run…June 12, 2009 Key News *Big increases in Fed bond purchases...
- Morning Run… August 3, 2009 Key News * Euro gains on positive manufacturing data...
- Morning Run … September 22, 2009 Key News * Fed Effort to Stoke Growth...
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