US equities are mixed in this morning’s future session after shares fell more than 1% on Monday. S&P 500 and Dow futures are each looking slightly up, but futures on the Nasdaq are slightly lower.
Yesterday stocks fell in the absence of fresh economic data, but today should be a different ball game with the the Case-Shiller Home Price Index hitting markets half an hour before the open, and the Conference Board’s look at consumer confidence hitting markets an hour later.
After hitting a 12-month high at $82 per barrel last week, WTI Crude oil has been edging lower for the past few sessions. It currently is trading at $78.85 per barrel. Meanwhile, Spot Gold is also down $1.90 to $1040.90.
Yesterday’s session looked fruitful in the early hours as Verizon and Radioshack each posted positive Q3 earnings reports, but stocks fell just before lunch hour and never recovered. Part of the pessimism was related to comments from influential banking analysts Bove. Saying “2010 is going to be a tough year,” Bove downgraded several banks and recommended waiting two years.
Key Events Today:
The weekly retail sales indexes from the International Council of Shopping Centers and the Johnson Redbook are looking somewhat optimistic as the holiday period approaches. These indexes are decidedly second-tier, but they do offer a first take on consumer spending.
9:00 ― The S&P Case Shiller Home Price Index is expected to see its fifth consecutive rise in August. Overall the market remains weak and economists worry about a W-shape in prices once (if?) government support is stripped away, particularly when the tax credit for first-time home-purchases expires on Nov. 30.
“By almost any measure, the trend in house prices has taken a sharp turn,” said analysts from Nomura Global Economics. “In Q1, the ‘seasonally adjusted’ Case-Shiller 20-city index was falling at an annualized rate of about 20% per month; in July it increased at an annualized rate of 15%. We believe that much of this improvement is the result of seasonal factors rather than a sudden shift in supply/demand fundamentals, and that seasonal adjustment techniques are not capturing this properly. We think prices will experience a downswing later this year as negative seasonal forces take hold, and August may be the first month of deceleration.”
10:00 ― Consumer Confidence could go in either direction. Equity prices are up but hey, so is the unemployment rate. Which to choose, which to choose? The consensus sees a small improvement from 53.1 to 54.0, but the range of estimates is revealingly split from 51.0 to 55.0.
Joseph LaVorgna from Deutsche Bank looks for a slight uptick based on data suggesting that consumer spending is stabilizing. “Based on retail sales data through September, we estimate that consumer spending increased a decent 3% last quarter. Importantly, we are seeing gains outside of autos—retail sales excluding motor vehicles increased 3.6% at an annual rate, the first increase since Q2 2008.”
- Treasury Auctions:
- 1:00 ― 4-Week Bills
- 1:00 ― 2-Year Notes
