The MorningSnapshot- 05/15

The MorningSnapshot
May 15, 2012

Unfortunately, this will be the last publication of The MorningSnapshot before I take the level 2 exam in the CFA program on June 2. In addition to my studies, due to the NATO conference I will have limited access to the office over the next week. Please look for The MorningSnapshot to return on June 4.

Morning Commentary
Sentiment is looking brighter this morning before several important U.S. economic releases and after Moody’s yesterday  cut the rating of 26 Italian Banks, as anticipated by the markets. Treasuries are declining after yesterday’s rally that pushed 7yr yields to a record low, and most sovereign yields are higher as Germany’s economy expanded at a 0.5% pace compared with forecasts that called for a -0.2% contraction. The euro is up +0.1% after falling yesterday to its lowest level since January.

Update: 8:30am EST
Retails sales in the U.S. cooled on the early Easter and seasonably warm weather. U.S. CPI was unchanged, and the core rate climbed +0.2%. Manufacturing in the New York region came in higher than anticipated. The trade gap narrowed less than forecast as exports to the EU continue to slow.

Today’s Economic Data Lineup (EST)
8:30am: CPI (M/m), Apr., est. 0.0% (prior 0.3%)
8:30am: CPI Ex-Food/Energy (M/m), Apr., est. 0.2% (prior 0.2%)
8:30am: Empire Manu., May, est. 9 (prior 6.56)
8:30am: Advance Retail Sales, Apr., est. 0.1% (prior 0.8%)
8:30am: Retail Sales Less Autos, Apr., est. 0.2% (prior 0.8%)
8:30am: Retail Sales Ex-Auto/Gas, Apr., est. 0.3% (prior 0.7%)
9:00am: TIC Flows, Mar., est. $107.7b
9:00am: Long-term TIC Flows, Mar., est. $32.5b (prior $10.1b)
9:30am: Fed’s Duke speaks on housing in Washington
10:00am: Business Inventories, Mar., est. 0.4% (prior 0.6%)
10:00am: NAHB Housing Market Index, May, est. 26 (prior 25)
11:00am: Fed to sell $8b-$8.75b notes in 2/15/2014 to 5/31/2014 range
11:30am: U.S. to sell 4-week bills

North America

  • Facebook has increased its IPO price range to $34-38 a share compared with the previous range of $28-$35. The new range was announced in regulatory filings this morning.

Europe

  • Germany’s economy expanded by +0.5% versus the -0.2% contraction forecast by economists in a Bloomberg News survey; Germany is helping the euro area avoid falling back into its second recession in three years.
  • Moody’s finally cut the ratings of 26 Italian banks, citing weakening earnings and the country’s poor economic outlook.
  • Greece will decide today whether to pay €436M to bondholders that have shunned last month’s debt swap.

Asia

  • China’s Ministry of Commerce said today that foreign direct investment in China fell for a sixth month in April, the longest stretch of declines since the global financial crisis; inbound investment dropped -0.7% from a year earlier to $8.4B compared with a -6.1% drop in March.

“So long as there is breath in me, that long I will persist. For now I know one of the greatest principles on success; if I persist long enough I will win.”
Og Mandino
____________________________
Taylor Anderson
Business Analyst
Clearing House

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

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