Awaiting Weekly U.S. Jobless Insurance Claims Data

April 2, 2020

The stage for this week’s renewed financial market pessimism had been set a week ago when the Labor Department reported a record 3.283K upsurge in new jobless insurance claims for the week of March 21st, and now investors are bracing for an even greater increase of close to 4 million or more. The U.S. advance trade deficit estimate and the New York regional purchasing managers survey also get reported today.

Overnight, the price of West Texas Intermediate crude oil rebounded nearly 10% and is above $22 per barrel for the first time in a week. The price of gold climbed 1.0% and is above $1,600 per ounce.

10-year sovereign debt yields rose 3 basis points in German and a basis point in U.S. futures but slid 2 bps farther into the red in Japan’s case.

Stock markets in the Pacific Rim closed mixed with losses of 2.0% in Australia and 1.4% in Japan but gains of 2.3% in South Korea, 1.8% in Hong Kong and 1.7% in China. In Europe, share prices are down 0.2% in Spain where 616 new Covid-19 deaths occurred in the past 24 hours, but other markets have rebounded such as Italy (+1.2%), France (+0.8%), the U.K. (+0.6%) and Switzerland (+0.7%). The German Dax is just 0.2% firmer.

The dollar rose 0.4% against the euro and Mexican peso and by 0.2% versus the yen overnight but has also fallen 0.6% relative to the kiwi, 0.4% versus the Aussie dollar, 0.3% vis-a-vis the loonie and sterling and 0.1% against the yuan.

The coronavirus pandemic is fast approaching global milestones of 1 million confirmed cases and 50K deaths. The four countries with the most deaths are Italy (13,155), Spain (10,003), the United States (5,357) and France (4,032).

Producer prices in the euro area fell 0.6% in February, the most in 8 months, depressing the 12-month rate of decline to 1.3%, most in 3 months.

South Korean consumer prices slipped 0.2% last month, and its 12-month rate of increase, which had crested at a 14-month high in January of 1.5%, dropped to a 3-month l ow of 1.0%.,

Swiss consumer prices edged 0.1% higher for a second straight month in March, resulting in a 4-year low of -0.5% in on-year inflation. Core CPI inflation fell to a 25-month low of -0.1%.

Cypriot CPI inflation was halved to 0.7% in March versus 1.4% in February.

Spanish unemployment shot up 302K last month, the biggest monthly advance since at least the start of 2001. The number of total outstanding unemployed workers is at a 35-month high.

India’s manufacturing purchasing managers index fell 2.9 points to a 4-month low of 51.6 in March.

Growth in Japan’s monetary base, which is what the BOJ controls most directly, slowed to 2.8% in March after spiking to 3.6% in February. The first-quarter pace of 3.1% was down from calendar year advances of 3.6% in 2019 and 7.3% in 2018.

Copyright 2020, Larry Greenberg. All rights reserved. No secondary distribution without express permission.


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