The last day of trading for September and for the third quarter finds US index futures rebounding 0.3%-0.5%, but still struggling to claw back all of the losses sustained earlier this week. It remains to be seen if indices can hold onto these gains through the day after yesterday’s early rally faded as the day progressed.
News that US politicians may be able to kick the can down the road appears to be helping sentiment so far. Last night, US Senators passed a spending bill to avoid an otherwise imminent government shutdown, funding operations to early December and including emergency spending for hurricane relief and resettling Afghan refugees. In Canada, the federal government and federally regulated industries like banks are closed for the first National Truth and Reconciliation Day.
There are a number of US economic reports out today. Q2 GDP was revised upward to 6.7% slightly above the 6.6% street estimate. Weekly initial jobless claims were worse than expected (362K vs street 335K and previous 351K). US Chicago PMI, a preview of tomorrow’s national numbers is due at 9:45 am (street 65.0 vs previous 66.8). Tomorrow brings manufacturing PMI reports from around the world, Canadian monthly GDP, plus US construction spending, personal income/spending, and auto sales.
China reported mixed PMI numbers overnight. Manufacturing PMI fell below 50 into contraction territory and missed street expectations (49.6 vs street 50.1), while Non-Manufacturing PMI jumped back up over 50 into expansion territory and beat the street (53.2 vs street 52.7 and previous 47.5). Continuing the mixed market theme of the day, Hong Kong fell 0.3% while Shanghai gained 0.3% on the news. In Europe, the FTSE is up 0.2% while the Dax is down 0.2%.
Action across commodity and currency markets is also very mixed suggesting that investors are mainly squaring positions for the end of the quarter. Natural gas is up 5.0% while WTI crude oil is down 1.0% and copper is down 1.7%. Gold is up 0.2% while Bitcoin is bouncing 4.7%.