Stocks Stabilize After Monday’s Selloff

Monday’s North American selloff carried into Asia Pacific trading, where stocks declined as the Reserve Bank of Australia raised its overnight rate by 0.25 percentage points to 4.60%, as widely expected. By morning in Europe and North America, stocks were starting to stabilize. Commodity trading is mixed, with Crude Oil falling and Gold rising, while bond trading has been quiet so far. With little business news today and several reports due later in the week, investors appear to be positioning ahead of tomorrow’s month and quarter-end.

Canada’s July GDP was unchanged, in line with Street expectations. NASDAQ futures are up 0.4% and Dow futures are up 0.3%. In Asia, the Nikkei fell 0.6% and the Hang Seng declined 0.5%. European markets are firmer, with the DAX up 0.9% and the FTSE up 0.2%.

Crude Oil is down 1.9%, moving back toward $90.00/bbl., while Brent Crude has slipped 1.4% to below $105.00/bbl. Gasoline is down 2.0% toward $3.25/gallon. Gold is up 0.4% but remains below $4,200/oz.; Copper is down 0.2% but holds above $6.60/lb. The US 10-year Treasury yield remains above 5.20% and the 30-year yield above 5.50%. The USD Index and Loonie are steady, while the Euro is down 0.2%.

Wednesday brings US Core PCE inflation and ADP payrolls, followed by Manufacturing PMI reports from around the world on Thursday. US Nonfarm Payrolls and Factory Orders close out the week on Friday. Nike reports earnings after Thursday’s close.

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