Daily Markets: Data Reports Investors Will Watch Today

The big picture of today

Asian stock indices ended the day on a lower note with modest declines recorded in Japan’s Nikkei, Hong Kong Hang Seng and China Composite Index while India’s Sensex closed higher 0.6%. By midday, European stock indices were mostly higher and US futures suggest a positive market opening later this morning, but that could change in the hours to come.

Like yesterday and the July CPI report, investors will be eagerly awaiting the July PPI report due at 8:30 am ET today. Economists are forecasting an overall rise of 0.6% for the month, with an annual reading of + 7.3%, and a base PPI for the month at + 0.5% MoM and 5.6% YoY. During the June quarter-to-date earnings season, companies have warned of rising inputs as well as transportation costs and upcoming pressures on margins. Chances are, the more the PPI exceeds the CPI, the more likely we will hear companies discussing price increases to offset these rising costs in an effort to maintain margins and meet EPS targets. For investors, the July PPI report will help put specific numbers behind these comments and reassess BPA’s expectations for the remainder of 2021.

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International economy

Japan’s producer price index rose more than expected to 5.6% year-on-year in July, from 5% in June, where it was expected to remain.

Consumer inflation expectations in Australia fell to 3.3% in August from 3.7% in July.

The UK’s preliminary Q2 GDP estimate rebounded to + 4.8% XX after falling -1.6% in Q1, matching consensus forecasts. UK industrial production rose 8.3% yoy in June from 20.7% yoy in May, after which it is expected to decline to 9.4%. Manufacturing output slipped to + 13.9% year-on-year in June from + 27.7% in May, but topped the expected figure of 13.6% in June.

China saw outstanding loans grow by + 12.3% year-on-year in July, as expected and in line with June’s pace. M2 money supply in July increased 8.3% year-on-year from 8.6% in June.

The euro zone saw industrial production in June increase by 9.7% year-on-year, a much slower pace than the + 20.5% recorded in May and not as fast as the + 10.4% expected. On a monthly basis, June industrial production in the eurozone fell 0.3%, slightly lower than the expected 0.2% drop.

The International Energy Agency has “sharply” cut forecasts for global oil demand for the rest of the year as the resurgent pandemic hits major consumers, and has predicted a new surplus in 2022.

Domestical economy

Yesterday’s CPI saw headline inflation stand at a stable level of 5.4%, unchanged from June, compared to expectations of a decline to 5.3%. Core CPI fell as expected to 4.3% from 4.5%, finally falling to a significant degree after three consecutive double-digit (annualized) increases in core CPI. The massive increases we have seen in areas such as airline tickets, used cars, hotels and car rentals are starting to fade.

Later today we will have the Producer Price Index (PPI) for July and the usual weekly jobless claims report.

Markets

It was a fairly mild day in the markets as the Dow Jones rose 0.6% to close at a new high and the S&P 500 also rose 0.2% to a new high while the Nasdaq rose fell -0.1% basis point. The yield on the 10-year Treasury bill fell to 1.347%. Gold fell -0.02%, silver fell 0.3%, but copper added 0.8%. Bitcoin lost 1.4% and Ethereum fell 1.9%.

Actions to watch

Ahead of the opening of U.S. stock markets this morning, investors will flip through a number of quarterly earnings reports, including those from Baidu (BIDU), CyberArk (CYBR), Bon RX (GDRX), and Brands Utz (UTZ).

Flashing load (BLNK) Second-quarter revenue was almost twice as high as expected, but the company also reported a much larger-than-expected net loss, due to operating expenses that were 278% higher than the same quarter last year. The business is growing rapidly with the total number of subscribed, sold or deployed charging stations dropping from 380 a year ago to 3,264 this quarter – that deserves a holy cow! The company’s geographic footprint includes installation contracts spanning Chile to New York, New Jersey to Texas and an agreement with General Motors (GM) to provide GM EV customers with access to the Blink network.

Chinese electric vehicle company Nio inc. (NIO) reported a smaller-than-expected loss for its June quarter, with quarterly revenue rising 127% year-on-year to RMP 7.91 billion, missing the consensus of RMB 8.3 billion. For the current quarter, Nio forecasts revenues in the range of RMB 8.9 to 9.6 billion against a consensus of RMB 9.2 billion.

A smaller than expected loss in the June quarter was recorded by the end-to-end ecommerce platform company Vroum (VRM). Revenue for the quarter jumped 21% year-on-year to $ 761.9 million, crushing the consensus of $ 651 million. Ecommerce units sold in the quarter increased 172% year-on-year to $ 18,268, driving up 230% year-on-year to $ 579.7 million. For the current quarter, Vroom expects e-commerce unit sales of 20,000-20,500, implying year-over-year growth of 130% in the middle of the benchmark range, with a average selling price per ecommerce unit of $ 32,000 to $ 33,000 and average ecommerce gross margin per unit of $ 2,350 to $ 2,450.

The Financial Times brings back shares in Coupang (CPNG), the SoftBank (SFTBF) A sustained e-commerce group, plunged into after-hours trading as it reported larger quarterly losses after a fire destroyed the company’s largest logistics hub in South Korea.

Hon Hai Precision (HNHPF), Apple (AAPL) major assembly partner, projected sales of gadgets such as smartphones will drop sequentially this quarter, raising concerns that chip and component shortages will affect iPhone production ahead of the holiday season .

At 1 p.m. ET, FireEye (FEYE) conducts its monthly threat briefings for investors and financial analysts to provide visibility into trends in the global cyber threat landscape.

Amazon (AMZN) Amazon Web Services announced a global collaboration with Wyndham Hotels & Resorts (WH) to upgrade its technology infrastructure and develop and deliver new services to customers across its 21 hotel brands, including Days Inn, La Quinta, Microtel, Ramada, Super 8 and Wyndham.

Toll Brothers (TOL) acquired StoryBook Homes, a private home builder based in Las Vegas, Nevada. The terms were not disclosed.

Reports suggest that over the past two months, DoorDash (DASH) held talks to buy private company Instacart for a price that would likely have been between $ 40 billion and $ 50 billion.

After today’s market closes, Airbnb (ABNB), DoorDash (DASH) and Walt Disney (DIS) will be among the companies that will publish their quarterly results. Those looking to get a glimpse of the revenue reports to be had in the coming days should visit Nasdaq earnings calendar page.

On the horizon

  • August 13: Import and export prices, University of Michigan consumer sentiment
  • August 16: NY Empire State Manufacturing, Long-Term ICT Net Flows, Overall Net Capital Flows, Foreign Bond Investment
  • August 17: NAHB Housing Market Index, Retail Sales, Industrial Production, Business Inventories
  • August 18: Building permits, housing starts, EIA energy stocks, FOMC report
  • August 19: Philadelphia Fed manufacturing index, weekly jobless claims
  • August 23: Chicago Fed National Activity Index, Markit Manufacturing, Services and Composites PMI, Existing Home Sales
  • August 24: New Home Sales, API Crude Oil Inventory Report
  • August 25: durable goods orders, EIA energy stocks
  • August 26: Unemployment claims, Q2 GDP growth, corporate profits
  • August 27: Personal Income and Expenditure, Wholesale Inventories, PCE Price Index, Merchandise Trade Balance, University of Michigan Consumer Sentiment Report
  • August 30: Pending home sales, Dallas Fed Manufacturing
  • August 31: S & P / Case-Shiller Home Price Index, Chicago PMI, Conference Board Consumer Confidence, API Crude Oil Inventory Report

Thought of the day

“When people went on vacation, they shed their skin, thought they might be a new person.” – Aimée Friedman

Disclosures

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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