August 31, 2012
Stocks dropped on light volume just one day before Bernanke’s speech in Jackson hole, with the S&P 500 down -0.78% after initial jobless claims came in at 374K versus the 370K median economist estimate; the 10yr Treasury was down -2.56bps to 1.625%.
U.S. stocks pared gains as investors weighed a statement by Bernanke that he would not rule out more bond purchases to boost growth. “We have seen no net improvement in the unemployment rate since January,” Bernanke told central bankers and economists in the audience, according to a text of his remarks released in Washington. “Unless the economy begins to grow more quickly than it has recently, the unemployment rate is likely to remain far above levels consistent with maximum employment for some time.” His speech comes just two weeks before he leads an FOMC meeting to decide whether an expansion of the Fed’s record stimulus is warranted to spur growth.
Today’s Economic Data Lineup (EST)
9:45 am: Chicago Purchasing Managers, Aug., est. 53.5 (prior 53.7)
9:55 am: University of Michigan Sentiment, Aug. final, est. 73.6 (prior 73.6)
10:00 am: Factory Orders, July, est. 2.0% (prior -0.5%)
TBA: NAPM-Milwaukee, Aug. (prior 46.7) Central Banks
10:00 am: Fed’s Bernanke speaks at Jackson Hole conference
11:55 am: BOE’s Haldane on financial stability at Jackson Hole
1:15 pm: BOE’s Posen on monetary policy at Jackson Hole
- The Institute for Supply Management-Chicago said today that its business barometer fell to 53 this month versus estimates for a decline to 53.2.
- The University of Michigan final index of consumer sentiment climbed to 74.3 from 72.3 the prior month, beating the median estimate that called for a rise to 73.6.
- According to an EU official, the ECB would have a monopoly on granting all bank licenses in the euro zone under the draft rules due to be unveiled on Sept. 12.
- U.K. home prices rose the most in more than 2.5 yrs in August, with the average cost of a home rising +1.3% from July, the biggest monthly increase since January 2010.
- Japan’s consumer prices slid at a faster place in July and industrial production fell unexpectedly, raising the risk that the world’s third largest economy is slipping back into contraction. The benchmark price gauge (ex fresh food) fell -0.3% in July from a year earlier, putting the BOJ’s 1% inflation goal further from reach.
“Never be satisfied with what you achieve, because it all pales in comparison with what you are capable of doing in the future.”
-Rabbi Nochem Kaplan
T 312 634 8902
F 312 930 3187
C 312 618 8339