US stock markets were unable to hold on to their early gains yesterday and the three main indices finished the month with losses of 0.6%-0.8%. Bears have increasingly gained the upper hand overnight and into this morning. Asia Pacific trading saw Sydney fall 2.3%, Hong Kong retreat 1.8% and Tokyo lose 1.5%. In Europe this morning, the Dax, CAC and FTSE are all down 1.0%-1.2%. The three main US index futures contract are down 0.2%-0.6% so far today.
New lockdowns in China, this time in the city of Chengdu, appear to be raising concerns that resource demand could slow and dragging on sentiment toward commodities. Crude oil is down 1.6%, natural gas is down 0.5%, copper is down 1.6% and platinum is down 1.2%. Meanwhile new US restrictions on the export of high end semiconductors to China and Russia has some semiconductor stocks in retreat this morning including Nvidia, down 4.0% premarket, and AMD, down 2.4% premarket.
Monthly Manufacturing PMI reports have been rolling out overnight and into this morning with mixed results. On the positive side, France climbed back up above 50 into expansion territory, while Japan remained above 50 and beat expectations. The UK and Spain remained below 50 but were not as bad as investors anticipated. On the negative side, Germany remained below 50 and weakened more than expected.
Canadian Manufacturing PMI (street 53.6 vs previous 52.5) is due at 9:30 am EDT. The US ISM Manufacturing PMI report is due at 10:00 am EDT. Investors may look at a number of components to the US report including the headline number (street 52.0), new orders (street 48.5), and prices paid (street 55.5).
While awaiting tomorrow’s US nonfarm payrolls report today’s US employment reports, weekly initial jobless claims (232K vs street 248K) and Challenger layoffs (20.4K vs previous 25.8K), were better than expected and/or showed improvement. US construction spending (street -0.1%) is due at 10:00 am EDT.