Italian bonds are weaker again with the 2 yr yield up 17 bps to 1.18% and the 10 yr yield is up by 6 bps to 2.85%. There is not however any flight to safety in German, French, UK and US bonds because of the response to the story yesterday that June was a live meeting for the ECB in terms of discussing the end of QE. The ECB Chief Economist Peter Praet confirmed …
[Read more...] about The ECB story yesterday confirmed today
The ISM services index was a better than expected 58.6, up from 56.8 in April and one point better than the estimate. It does though follow a 2 pt drop in April from March. The stress on the supply chain which I keep harping on was clearly evident. Also, the tariff potential was an influence. While new orders were little changed, backlogs spiked by 8.5 pts, …
[Read more...] about ISM services good, supply constraints intensify
If only the curve can talk and tell us what it's thinking. The US 2s/10s spread is down to 42 bps, a fresh 11 year low. This after a slew of economic data was seen overseas and before key data in the US later today. Ahead of the US ISM services index at 10am, we saw some more PMI's overseas. The private sector weighted services PMI in China was unchanged in May …
Worries about Italy had a sharp impact on the Sentix economic confidence index for June which surveys investors. It fell to 9.3 from 19.2 and that is the lowest read since October 2016. The expectations component fell to the weakest since August 2012 soon after "Whatever it takes" was said by Draghi. Sentix said "The new government in Italy is giving investors fears …
Positives 1) Payrolls expanded by 223k in May, 33k more than expected and the two prior months were up a revised 15k. The unemployment rate fell another tenth to just 3.8% as the household survey showed a job gain of 293k at the same time the size of the labor market rose just 12k. The U6 unemployment rate is now down to 7.6% which is the lowest since May 2001. …
[Read more...] about Succinct Summation of the Week’s Events – 6/1
The ISM manufacturing index in May was .5 pt above the forecast at 58.7, up 1.4 pts m/o/m. It does though come after a 2 pt drop in April. The context for these internals should be a combination of things, 1)major supply constraints (trucking predominantly) being felt and thus companies trying to get whatever product they can and likely over ordering, 2)tariff worries …
Payrolls expanded by 223k in May, 33k more than expected and the two prior months were up a revised 15k. The unemployment rate fell another tenth to just 3.8% as the household survey showed a job gain of 293k at the same time the size of the labor market rose just 12k. Within this, of those aged 55+, 327k saw new jobs. The more comprehensive U6 unemployment rate is …
Now that we actually have the 65th Italian government since WWII, Italian bonds and banks are rallying. The 2 yr yield is down 27 bps and below 1% at .80%. The 10 yr is lower by 23 bps to 2.56%. What a wild ride but take note that these yields are still well above where they were just two weeks ago. The MIB index is higher by 2.6% with Intesa and UniCredit up about 6% …
Following my comments yesterday on German and Spanish inflation with both above 2% in May. France announced today that they are there too. CPI rose 2% y/o/y vs 1.6% last month and was one tenth more than expected. Even Italy reported an upside surprise to its CPI figure with a 1.1% print vs .6% in April and two tenths above the estimate. As for the whole eurozone …
Here are key headlines from the just released Beige Book: “Economic activity expanded moderately in late April and early May with few shifts in the pattern of growth. The Dallas District was an exception, where overall economic activity sped up to a solid pace.” “Manufacturing shifted into higher gear with more than half of the Districts reporting a pickup in …
Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor.
