The MorningSnapshot- 08/29

The MorningSnapshot
August 29, 2012

Technical problems are preventing me from sending out the attachment this morning.

Yesterday’s Wrap-Up
The S&P 500 ended the day down slightly on low volume after the S&P/Case-Shiller home price index rose +0.5% Y/Y in June versus estimates calling for a drop of -0.05%, while American consumer confidence fell by the most in ten months. The VIX index rose +0.9% to its highest level since Aug. 2 as investors flock to safety before Bernanke’s speech on Friday. 10yr U.S. Treasuries lost -2bps and are again testing resistance in the 1.63% area, after trading as low as 1.61%; 1.63% is the 50% retracement level from the all-time low on 7/25.

Morning Commentary
U.S. equities rose and European shares erased early declines as a report was released showing America’s economy grew more than earlier forecast last quarter. Treasuries declined, while metals, oil, and gasoline stayed lower.

Today’s Economic Data Lineup (EST)
7:00 am: MBA Mortgage Applications, Aug. 24 (prior -7.4%)
8:30 am: GDP Q/q (Annualized), 2Q, est. 1.7% (prior 1.5%)
8:30 am: Personal Consumption, 2Q, est. 1.5% (prior 1.5%)
8:30 am: GDP Price Index, 2Q, est. 1.6% (prior 1.60%)
8:30 am: Core PCE Q/q, 2Q, est. 1.8% (prior 1.8%)
10:00 am: Pending Home Sales M/m, July, est. 1% (prior -1.4%)
10:00 am: Pending Home Sales Y/y, July, est. 11.1% (prior 8.4%)
11:00 am: Fed to purchase $4.25b-$5b notes 8/31/2018-8/15/2020
1:00 pm: U.S. to sell $35b 5-yr notes
2:00 pm: Fed’s Beige Book

North America

  • The U.S. economy expanded more than previously estimated in the 2Q with GDP climbing at a +1.7% annual rate from April through June, higher than the +1.5% original estimate. The revised data reflects an improvement in the trade deficit and a pickup in household spending on utilities.
  1. The upward revision to GDP underscores risks for future growth by showing the contribution of weather and lower imports.
  • Hurricane Isaac pounded New Orleans and the northern Gulf Coast, arriving on land yesterday and delivering gale-force winds, heavy rain, and flooding across an area from Louisiana’s southern coast to the Florida Panhandle.  According to the National Hurricane Center, Isaac’s winds extend 175 miles beyond its center and may produce as much as 20 inches of rain in the region over the next two days.


  • ECB President Mario Draghi struck back at Germany’s criticism of his plan to intervene in the bond markets and reminded Europe’s largest economy of its responsibility to anchor the euro. The ECB “will always act within the limits of its mandate,” Draghi wrote in a commentary for German newspaper Die Zeit provided by the Frankfurt-based ECB today. “Yet it should be understood that fulfilling our mandate sometimes requires us to go beyond standard monetary policy tools.”
  • French industrial confidence remained near its lowest level in two years in August, increasing pressure on Hollande’s government to revive growth in the face of the euro-crisis. Sentiment among factory workers rose to 90 after a revised 89 in July.


  • Chinese retailers from clothes to computers are reporting weaker sales growth, undermining Premier Jiabao’s goal of relying on more consumer spending for expansion as the economy continues to cool.

 “The start is what stops most people.”
-Don Shula

Taylor Anderson
Business Analyst
Clearing House

T 312 634 8902
F 312 930 3187
C 312 618 8339

20 South Wacker Drive
Chicago, Illinois 60606

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