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Daily Briefing – Tuesday, October 3, 2017

US

Yesterday’s mass shooting in Las Vegas that killed nearly 60 people has prompted an instant surge in gun-maker stocks (Smith-&-Wesson +3.21%, Ruger +3.48%) following huge Year-on Year declines, but plunges in resorts (MGM-Int’l -5.58% and Wynn -1.24%). Otherwise,  markets continued upwards, GE and Intel leading the DJIA’s 0.68% rise. Meanwhile, as PMIs fall in Europe and Asia, the US’s Markit firm presented a green picture showing a 0.1 point increase to 53.1. The Institute for Supply Management, on the other hand, presented a 2-point increase to 60.8 – a 13-year record!

 

Europe

Spanish equities sank yesterday alongside the Euro following the Catalan vote and its subsequent violence. Elsewhere, European stock indexes rose for the 8th day in a row on the weakening currency. The Dax is at an all-time high and the FTSE at a 2-month high as the GBP falls against the Euro. Manufacturing PMIs came in mixed from throughout the continent, with Switzerland and France reporting better-than-expected improvements and Italy, the UK and the EU in the red. The zone’s unemployment figure also remained at a disappointing 9.1%

 

Asia

Asian indexes manage to hold on to gains, mainly, as China enters its second National day of celebrations for the creation of the People’s Republic in 1949. Japan’s money base contracted by a percent, reflecting continuingly weak inflation rates. And in Australia, building permits increased by 0.4% in August thanks to record-high population growth and record-low interest rates. The RBA last night kept interest rates at a level 1.5%, Governor Lowe warning against weak wage growth and stagnant consumption.

 

Commodities

WTI opens the day at 50.41, continuing to fall on a strengthening US Dollar and OPEC’s September report that shows overall compliance with its freeze deal to 86%. And gold is at a 2-month low of 1272, as yesterday’s ISM PMI bodes well for a December interest rate hike by the Fed, and bulls continue to buy on the oversold equity

 

 

Today’s Events

8:30 AM GMT UK: Construction PMI
9 AM GMT EU: PPIs
8:30 PM GMT API: Weekly Crude Oil Inventories

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