Morning Minutes

March Starts With a Market Rebound and Manufacturing PMI Numbers




Shrugging off a dismal finish to February that saw major indices plunge last Thursday, then stagger to a mixed finish on Friday (Dow down 1.5%, NASDAQ up 0.5%, March is off to a positive start so far. US index futures are up 1.0%-1.2%, while overseas, the Dax is up 1.0%, the FTSE is up 1.4%, the Hang Seng is up 1.6% and the Nikkei is up 2.3%.

The US 10-year treasury note yield has dropped back under 1.50% easing some of the concern which had gripped markets last week and igniting rebounds in currency and commodity markets. Cryptocurrencies are bouncing back today, led by Bitcoin which is up 8.6% but still trading below $50,000. Metals are moving with platinum up 2.8%, copper and silver up 1.6% and gold up 0.4%. In energy trading, WTI crude oil is up 1.2%, gasoline is up 1.4% and natural gas is flat. Catching a tailwind from rising commodities, the Canadian Dollar is up 0.5% against the US Dollar so far today.  

Investors appear to be responding positively to a number of positive developments over the weekend and into this morning including the US House of Representatives passing a new $1.9B fiscal stimulus package, and the US approving a third COVID vaccine (from J&J) for use.

Monthly manufacturing reports from around the world are out this morning and have been generally positive so far with major economies still in expansion territory above 50 and beating the street in several cases. Highlights include: Germany (60.7 vs street 60.6), the UK (55.1 vs street 54.9), Japan (51.4 vs previous 50.6), Australia (58.8 vs previous 55.3), and China (50.6 vs street 51.1). Canadian manufacturing PMI is due at 9:30 am EST today (previous 54.4), followed by US ISM (street 58.8 vs previous 58.7) at 10:00 am.

With earnings season now over and a new month starting, focus turns to economic news. In addition to today’ s manufacturing PMI reports, US construction spending (street 0.8% vs previous 1.0%) is due at 10:00 am today. Wednesday brings service PMI reports from around the world plus US ADP payrolls, wrapping up with US nonfarm payrolls and Canadian employment numbers on Friday.

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Colin Cieszynski, Chief Market Strategist

Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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