US equities are giving up their early gains and retreating to unchanged mid-morning. As of writing, the DJIA is flat, the S&P500 is up 0.15% and the Nasdaq is flat.
Job openings in America have hit a record high. The latest Job Openings and Labor Turnover Survey - one of Fed Chair Yellen's favorite gauges of labor market health - showed that job openings jumped to 5.75 million in July, the highest since the series began in December 2000. With openings at record highs, robust employment should be accompanied by a sustained pickup in wages, just another data point that suggests the Fed needs to tighten sooner rather than later.
The loonie was a bit volatile heading into today's Bank of Canada rate decision. USD/CAD rose to 1.3260 from 1.3185 in the Asia session ahead of the decision then shot down below 1.3160 before recovering a bit. The BoC held pat on rates and confirmed that Canada's resource sector continues to adjust to lower prices for oil and other commodities, with some spillover to the rest of the economy.
The corporate bond market drought seen over the last several weeks appears to be easing. Today is expected to be the busiest day for corporate issuance of the year so far, with 17 issuers and 33 tranches expected to come to market. The weakness seen in USTs - the 10-year yield has gained five basis points even as equities flatline - is largely due to the deluge of corporate offerings, plus the Treasury's 10-year reopening later today, with $21 billion on offer.
Shares of Hovnanian are losing ground this morning after the firm missed expectations in its third-quarter report. Revenue was well below expectations while the firm swung to a loss in the quarter that was a lot steeper than expected. Back in June, Hovnanian said it wasn't likely to be profitable for the current year ending in October due to the impact of incentives and concessions on homes built on speculation, but it also said today that the fourth quarter would be profitable. HOV is down 4% or so, while other homebuilders are following broader equity indices lower.
Following the IRS decision not to offer a private letter ruling on Yahoo's planned spinoff of its Alibaba stake, sources told CNBC's David Faber that the company is still considering its options and that it may consider an alternate "reverse spin" instead. In his report, Faber also mentioned that Yahoo was examining plans to spin off Yahoo Japan as well as its core businesses. Shares of YHOO lost around 7% yesterday after the IRS ruling and have only regained about 2% in trading today.
Looking Ahead
- 12:00 (US) DOE Short-Term Crude Outlook
- 13:00 (US) Treasury to sell $21.0B in 10-Year Notes
- 15:00 (MX) Mexico Aug ANTAD Same-Store Sales Y/Y: 6.0%e v 6.8% prior
- 16:30 (US) Weekly API Oil Inventories
- 17:00 (NZ) New Zealand Central Bank (RBNZ) Interest Rate Decision: expected to cut Official Cash Rate by 25bps to 2.75%
- 17:00 (KR) South Korea Aug Import Price Index M/M: No est v -0.1% prior; Y/Y: No est v 13.7% prior
- 17:00 (KR) South Korea Aug Export Price Index M/M: No est v 0.9% prior; Y/Y: No est v -1.7% prior
- 17:05 (NZ) RBNZ Gov Wheeler News Conference on OCR
- 19:50 (JP) Japan July Machine Orders M/M: +3.0%e v -7.9% prior; Y/Y: 10.3%e v 16.6% prior
- 19:50 (JP) Japan Aug PPI M/M: -0.4%e v -0.2% prior; Y/Y: -3.3%e v -3.0% prior
- 21:00 (AU) Australia Sept Consumer Inflation Expectation: No est v 3.7% prior
- 21:00 (PH) Philippines July Exports: No est v $5.3B prior; Y/Y: -3.8%e v -1.8% prior (revised from -3.3%)
- 21:30 (CN) China Aug CPI Y/Y: 1.8%e v 1.6% prior;
- 21:30 (CN) China Aug PPI Y/Y: -5.6%e v -5.4% prior
- 21:30 (AU) Australia Aug Employment Change: +5.0Me v +38.5K prior; Unemployment Rate: 6.2%e v 6.3% prior
Economic Data
- (PT) Portugal July Trade Balance: -€0.7B v -€0.8B prior
- (ZA) South Africa Q3 BER Consumer Confidence: 38.0 v 42.0e
- (BR) Brazil Sept IGP-M Inflation (1st Preview): 0.6% v 0.5%e
- (US) MBA Mortgage Applications w/e Sept 4th: -6.2% v +11.3% prior
- (US) Goldman Economist Chain Store Sales w/e Sept 5th w/w: +0.7%; y/y: +1.8%
- (CA) Canada Aug Annualized Housing Starts: 216.9K v 190.5Ke
- (CA) Canada July Building Permits M/M: -0.6% v -5.0%e
- (US) Weekly Redbook Sales w/e Sept 5th: +1.3% y/y, Sept MTD m/m: -1.3%
- (MX) Mexico Aug CPI M/M: 0.2% v 0.2%e; Y/Y: 2.6% v 2.6%e; CPI Core M/M: 0.2% v 0.2%e
- (CA) Bank of Canada (BOC) leaves interest rates unchanged at 0.50%
- (UK) Aug NIESR GDP Estimate: 0.5% v 0.7% prior
- (US) July JOLTS Job Openings: 5.753M v 5.300Me
[I]Contributed by Trade The News[/I]
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