Markets Are Going Nowhere

Matthew Boesler
people waiting at the airport
people waiting at the airport


It's a quiet morning in the markets as we enter the dog days of summer.

Right now, U.S. stock and bond futures are flat.

French, Spanish, and Italian stocks are up marginally, while London and Germany are down marginally.

In Asia, the Nikkei closed Tuesday up 1 percent and the Shanghai Composite rose 0.5%, but the Hong Kong Hang Seng fell 1.3%.

"After a busy period for macro, it seems we’ve now reached a post-nonfarm payrolls and summer-induced lull, if volumes across a number of markets are anything to go by," writes Deutsche Bank strategist Jim Reid in a note. "Indeed, according to Bloomberg data, yesterday’s S&P 500 volumes were the lowest for a Monday since 12th November 2012 excluding the Monday just before Christmas Day. The absence of any major headlines in the last 48 hours and the slow run-off of the US/European reporting calendar have also added to the temporary pause we’re experiencing."

Major economic data releases this morning include Italian Q2 GDP figures, due out at 5 AM ET, and German factory orders data for June, due out at 6 AM.

Italian GDP is expected to have fallen 2.2% year over year in the second quarter. German factory orders, meanwhile, are expected to have risen 1.0% in June from the previous month.

Then, at 8:30, we get June data on the U.S. trade balance. Economists predict the deficit narrowed to $43.5 billion in June from $45.0 billion in May.

" Range-bound Treasuries and rallying risk assets may be the order of the day," says Société Générale global strategist Kit Juckes. "On balance, I could see why that mix would be better for Euro (and even more so GBP) than for the USD or JPY, though none are actually moving."

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