Friday, August 11, 2017

North Korea Tensions Sap Risk Appetite

TradeTheNews.com Weekly Market Update:  North Korea Tensions Sap Risk Appetite
Fri, 11 Aug 2017 16:22 PM EST

US equities had their worst week in months as global markets took a risk-off tone in response to increasingly bellicose rhetoric between President Trump and North Korea. European bourses were also hit by the multi-day selloff, with the Stoxx 600 headed for its worst week since November. Traditional safe haven currencies like the yen and Swiss franc rose, increasing volatility sent the VIX up 49% by Friday, and gold shot up to a two-month high. The Greenback had strengthened Tuesday on the back of another record high in the US JOLTS job openings data, but the dollar weakened later in the week after PPI data came in lower than expected and Fed's Dudley made remarks that sounded more cautious about the inflation outlook than he did just a couple of months ago. CPI data on Friday also came in below consensus, lowering the probability on futures markets for a Fed December rate hike to 40%, which helped to put a floor under US markets' downward drop. In South Africa, Pres Zuma survived yet another ‘no-confidence’ vote, sending the Rand sliding. For the week, the DJIA lost 1.1%, the S&P500 dropped 1.4%, and the Nasdaq dipped 1.5%.

In corporate news, earnings season wound down with a few more surprises. Disney weighed on the Dow as investors appeared reluctant to look past another quarter of disappointing results, particularly for ESPN and the media division, even as management tried to put focus on the upcoming launch of a branded streaming service. Snap breached a new low after reporting disappointing earnings, lower than expected daily usage numbers, and a slowdown in Spectacles sales. Macy’s and JC Penney’s earnings showed the woes for retailers aren’t over: shares of both mall anchors hit new 52-week lows after reporting more grim numbers weighed on by heavy promotional activity and the digestion of store closures. Meanwhile, reports emerged that Amazon is entering another new sector, this time the venue ticketing market, hitting shares of Live Nation and Stubhub’s parent eBay. Rockwell Collins was lifted on speculation that UTX is working towards a bid.


SUNDAY AUG 6
(NZ) NEW ZEALAND Q3 INFLATION EXPECTATION SURVEY: 2-YEAR INFLATION EXPECTATION 2.09% V 2.17% PRIOR

MONDAY AUG 7
TSLA Files to sell $1.5B 2025 unsecured notes (2.6% of market cap)
(CN) CHINA JULY FOREIGN RESERVES: $3.081T V $3.075TE (6th straight increase and 9-month high)
(EU) EURO ZONE AUG SENTIX INVESTOR CONFIDENCE: 27.7 V 27.6E
TATA.IN Reports Q1 (INR) Net 9.18B v 11.4Be, Rev 308B v 284.7Be
(ZA) South Africa Parliamentary speaker Mbete: parliament to hold secret ballot on Pres Zuma no-confidence vote - press
(CN) CHINA JULY TRADE BALANCE (CNY): 321.2B V 297.4BE
(CN) CHINA JULY TRADE BALANCE: $46.7B V $45.0BE

TUESDAY AUG 8
(CN) China Passenger Car Association (PCA): Jul vehicle sales 1.7M units, +5.5% y/y; YTD sales 12.5M units, +0.6% y/y
DPW.DE Reports Q2 Net €602M v €595Me, EBIT €841M v €752M y/y, Rev €14.8B v €14.2B y/y
VRX Reports Q2 (GAAP) -$0.11 v -$0.88 y/y, Rev $2.23B v $2.24Be
(US) JUN JOLTS JOB OPENINGS: 6.16M V 5.70ME (record high)
(KR) North Korea is said to have produced a miniaturized nuclear warhead that could fit inside a missile, according to US intel assessment - Wash Post
(ZA) SOUTH AFRICA PRESIDENT ZUMA SURVIVES NO-CONFIDENCE VOTE; Parliament votes against no confidence motion via secret ballot
(US) President Trump: North Korea should not make any further threats against the US, it would "be met with fire and fury"
DIS Reports Q3 $1.58 v $1.53e, Rev $14.24B v $14.4Be
(KR) North Korea state media: US war hysteria will bring a miserable end; North Korea could strike before any preemptive attack by the US, could strike Guam with mid-to-long range missiles
(CN) CHINA JULY CPI Y/Y: 1.4% V 1.5%E; PPI Y/Y: 5.5% V 5.6%E

WEDNESDAY AUG 9
(FR) BANK OF FRANCE JULY BUSINESS SENTIMENT: 105 V 103E
(US) Q2 PRELIMINARY NONFARM PRODUCTIVITY: 0.9% V 0.7%E ; UNIT LABOR COSTS: 0.6% V 1.1%E
(US) Atlanta Fed cuts Q3 GDP to 3.5% from 3.7% on 8/4
(US) Association of American Railroads weekly rail traffic report for week ending Aug 5th: 554.8K carloads and intermodal units, +4.3% y/y (30th straight week of gains)
(NZ) NEW ZEALAND CENTRAL BANK (RBNZ) LEAVES OFFICIAL CASH RATE (OCR) UNCHANGED AT 1.75%; AS EXPECTED
(CN) PBOC SETS YUAN REFERENCE RATE AT: 6.6770 V 6.7075 PRIOR (strongest setting since Sept 29th)

THURSDAY AUG 10
TKA.DE Reports Q3 adj Net €120M v €130M y/y, adj EBIT €620M v €441M y/y, Rev €10.9B v €10.5Be
(FR) FRANCE JUN INDUSTRIAL PRODUCTION M/M: -1.1% V -0.6%E; Y/Y: 2.6% V 3.1%E
(PH) PHILIPPINES CENTRAL BANK (BSP) LEAVES OVERNIGHT BORROWING RATE UNCHANGED AT 3.00%; AS EXPECTED
(UK) JUN INDUSTRIAL PRODUCTION M/M: 0.5% V 0.1%E; Y/Y: +0.3% V -0.1%E
M Reports Q2 $0.48 adj v $0.44e, Rev $5.55B v $5.50Be
(US) JULY PPI FINAL DEMAND M/M: -0.1% V 0.1%E; Y/Y: 1.9% V 2.2%E
(MX) MEXICO CENTRAL BANK (BANXICO) LEAVES OVERNIGHT RATE UNCHANGED AT 7.00%; AS EXPECTED
(KR) President Trump: Maybe my 'fire and fury' warning statement to North Korea wasn't tough enough - comments in Bridgewater, NJ
LYV Amazon reportedly has sought partner with venue owners to enter event ticketing market in the US; Amazon previously held talks with Live Nation's Ticketmaster but those conversations have stalled - press
SNAP Reports Q2 -$0.16 v -$0.14e, Rev $181.7M v $187Me
NVDA Reports Q2 $1.01 v $0.69e, Rev $2.23B v $1.95Be
(AU) RBA Gov Lowe: Not prepared to intervene at moment, but prepared to intervene in A$ in 'extreme' situations

FRIDAY AUG 11
(US) JULY CPI M/M: 0.1% V 0.2%E; CPI EX FOOD AND ENERGY M/M: 0.1% V 0.2%E; CPI INDEX NSA: 244,786 V 244.925E
(US) Weekly Baker Hughes US Rig Count: 949 v 954 w/w (-0.5% w/w)