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US stock market, economy and companies update (September 11, 2012)

Contributed by Trade The News

- Before the open Moody's warned that it could downgrade the US triple-A rating if next year's budget negotiations do not produce policies that begin to decrease debt levels. Moody's said that its outlook assumes a relatively orderly process for the increase in the statutory debt limit, which has become a bone of contention in the Congress. House Speaker Boehner commented that he was not at all confident that the US can avoid the fiscal cliff or a further ratings downgrade. Meanwhile, a former PBoC official observed that if US debt included social security and Medicare related liabilities, the US debt-to-GDP ratio would be approximately 200%. On the data front, the US trade deficit grew slightly in July although remained lower than expectations. Note that exports to Europe shrank and imports from China soared to a new record. Both factors (plus recent euro strength) have helped push the dollar index below 80 this morning for first time since May. The USD/JPY pair drifted below 78 while the EUR/USD lingered just below the 1.28 level.

- Sonoco cut its Q3 outlook in a release out last night, blaming internal operating problems for the lowered forecast. The company said it has been impacted by unscheduled downtime at several mills, plus some lower than projected demand. Small tech name Polypore warned that its Q3 and Q4 earnings would not meet consensus expectations due to weakness in demand over the summer and some temporary shut-downs of its customers' plants. Zynga saw another top executive depart, this time the chief marketing officer.

***Looking Ahead***
- (US) US Treasury official Brainard to visit France, Germany and Spain
- (GR) Greece PM Samaras to meet ECB chief Draghi
- 11:30 (US) Treasury to sell $40B in 4-Week Bills
- 12:00 (EU) ECB's Asmussen speaks in Frankfurt
- 13:00 (US) Treasury to sell $32B in 3-Year Notes
- 13:15 (UK) BOE member Miles
- 16:30 (US) Weekly API Crude Oil Inventories
- (PE) Peru July Trade Balance: No est v $441.7M prior

***Economic Data***
- (ZA) South Africa July Manufacturing Production M/M: -1.1% v -0.5%e; Y/Y: 5.8% v 6.2%e
- (US) Aug NFIB Small Business Optimism: 92.9 v 91.4e
- (US) ICSC/GS weekly chain store sales w/e Sept 7th: +1.0% w/w; +3.4% y/y
- (PL) Poland July Current Account: -€1.0B v -€1.4Be; Trade Balance: -€314M v -€716Me
- (CA) Canada Aug Housing Starts: 224.0K v 200.0Ke
- (US) July Trade Balance: -$42.0B v -$44.0Be
- (CA) Canada July Intl Merchandise Trade: -C$2.3B v -C$1.3Be
- (US) Redbook Retail Sales w/e Sept 8th: +2.6% y/y Sept MTD: +1.9% m/m, Sept MTD +2.7% y/y
- (MX) Mexico July Industrial Production M/M: 0.5% v 0.3%e; Y/Y: 4.9% v 3.9%e
- (EU) ECB Weekly Forex Reserves w/e Sept 7th: €238.9B v €241.8B prior
- (US) Sept IBD/TIPP Economic Optimism: v 46.4e
- (US) July JOLTs Job Openings: 3.664M v 3.740Me