US Second-Quarter GDP Growth Revised Higher
Today's financial recap and tomorrow's financial outlook.
The first revision of second-quarter US GDP showed growth rising to an annualized rate of 2.5% from the advance estimate of 1.7%. The increase was due to a narrowing trade gap in June and a smaller decrease in June consumption growth than had been expected. Initial jobless claims fell to a weekly pace of 331,000 from 337,000 in the week prior.
US equities fell in response to the GDP report. The S&P 500 (INDEXSP:.INX) opened down three points before rallying another 15 in the next hour. Headlines from the White House's afternoon press briefing on Syria sent stocks lower in the closing hours of the day. Telecom sector stocks led the way today alongside strength from regional banks and consumer discretionary stocks. Crude oil plummeted 1.5% in the closing moments of the day, sending energy stocks down more than 1%.
Weekly natural gas inventories showed a build of 67 billion cubic feet vs. estimates of 61-66 BCF, according to the EIA. Natural gas was up 1.1% in the day's trading. Treasuries rebounded after a sharp sell-off following the better GDP report. The Treasury auctioned $29 billion 7-year notes at a high yield of 2.221%, slightly better than had been expected. The 10-year Treasury closed the day at a yield of 2.74% after reaching an intraday peak of 2.82%.
Tomorrow's Financial Outlook
July personal spending and income statistics will be released tomorrow morning. Economists are expecting spending to rise 0.2% from the month prior. Earlier this month the July retail sales report showed 0.2% growth from the month prior. The other two significant reports for the day are the Milwaukee ISM and Chicago PMI. Both are the most statistically significant manufacturing reports for August.
Global market-moving news is due out from Japan, Germany, and Australia. Australia will release private sector credit growth from July. Japan will release July housing starts, CPI, industrial production, and jobless rates. Lastly, Germany will release July retail sales.
There will be no major earnings reports tomorrow in the US.
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