Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Positive China Trade Data Buoys US Equities

By

Today's financial recap and tomorrow's financial outlook.

PrintPRINT
The overnight news flow was dominated by positive economic data out of China. China's August trade balance showed larger growth in exports than expected and a decline in import volume. China's trade surplus expanded to $28.52 billion from $17.82 billion. Export growth saw the biggest jump in aluminum and steel products. China's consumer price index fell to an annual rate of 2.6% from 2.7% in the month prior. Japan's final estimate of 2Q GDP expanded to an annual rate of 3.8% from the first estimate of 2.6%. The Japanese Nikkei (INDEXNIKKEI:NI225) was up 2.48%.

US equities started off the day positively and continued higher with no apparent catalyst. The S&P 500 (INDEXSP:.INX) broke out of a short-term uptrend channel, continued into horizontal resistance at 1670, and closed above its 50 day moving average. News reports surfaced around the middle of the day that Russia was offering a deal where Syria would forfeit and destroy its chemical weapons in exchange for no military strikes on the country. US government officials were skeptical over the validity of the Russian statement on Syria.

Material and emerging market shares led the day's trading. Materials were no doubt buoyed by the continued strength in the Chinese trade data. The July consumer credit report showed a seasonally adjusted gain of $10.43 billion in the month, down from a $11.92 billion rate in the month prior. Gains were seen in auto and student loans.

Two M&A deals went through today. Ares Management and the Canada Pension Plan Investment Board acquired high end retailer Neiman Marcus for $6 billion. Additionally, Molex was purchased by Koch Industries for $38.50 per share in cash.

Tomorrow's Financial Outlook

The August NFIB small business optimism outlook index will be released tomorrow morning. Analysts estimate that the index will rise to 95.0 from 94.1 in the prior month. The other economic data point is the government's July JOLTS job openings, a stale employment data point given Friday's August payrolls report. The Treasury will auction off $31 billion in 3-year notes at 1 p.m. ET. Lastly, in the evening, President Obama is scheduled to give his report on the US's evidence of Syrian chemical weapons use.

Important economic data is due out overnight from China. The country will release its August industrial production, retail sales, and fixed asset investment data. The last data point is most important due to its heavier weighting in China's GDP. Other economic data due out is Italy's GDP and Canada's August housing starts.

The sole earnings report scheduled is from Restoration Hardware Holdings (NYSE:RH).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE