SocGen

SocGen On China's Slowdown In The Making

China’s activity growth decelerated more than expected in October for the most part, while inflation surprised on the upside. Supply constraints imposed by the air pollution reduction programme clearly played a role, while demand slowdown emerged only a little. However, the seeds have been sown for a full-fledged growth slowdown in 2018.

Dollar Rebounds, Futures Rise Ahead Of Surge In Payrolls

One day after the dollar slumped sharply on initial disappointment with the GOP tax plan, the greenback has rebounded ahead of a nonfarm payrolls report that is expected to show the US economy gained over 300,000 jobs in the post-hurricane rebound, and as investors reassessed the latest news on U.S. tax-cut plans. Stocks in Europe and Asia advanced, US equity futures were as usual in the green,

Payrolls Preview: Here Comes The Post-Hurricane Surge

The BLS will release the October Employment Report at 08:30am ET on Friday, November 3.  The Street is looking for a veritable surge in hiring following the hurricane-related disruption last month sent monthly payrolls to the first negative print in 7 years. Analysts also expect wage growth to continue rising: Median forecasts looks for 310k nonfarm payroll jobs, with average hourly earnings rising rise to 2.7% Y/Y

ECB Preview: Here's What Draghi Will Announce Today

Thursday's ECB meeting is expected to be one of the most important in recent years: Mario Draghi has signaled, and is widely expected to announce a blueprint of what the central bank's QE tapering will look like beyond 2017, and while no actual tightening will be implemented - either via rates of asset purchases - the ECB is expected to announce it will cut its €60bn/month bond purchases in roughly half starting in January 2018 and lasting for the next 9-15 months.

Trader: The Dollar Bounce Is Unlikely To Be Over Yet

Investors have become so used to low volatility they are starting to over-interpret every little move in asset prices. The two latest examples are traders concluding there’s no contagion from Turkey’s problems just as they begin, and dollar bears heralding the resumption of the long-term downtrend when the Bloomberg Dollar Spot Index is only 0.6% from its 12-week high.

Previewing The September "Hurricane-Disrupted" Jobs Report

Tomorrow's hurricane-affected September jobs report will be... confusing. That is the (lack of) consensus from Wall Street analysts, who expect an average print of 80,000 (down from the 3-month average of 185K), however with huge variance on either side, with 4 economists predicting a loss of jobs, three expecting a print higher than 150K and one optimistic forecaster going as high as 260,000.

SocGen: "Global Earnings Are Back To 2014 Levels; Stocks Are 15% Higher"

"QE sustained equities levels in anticipation of a profit recovery, but rather than de-rating as those earnings came through, markets are simply being propelled to ever higher levels. The equity valuation problem was created during the 2011-15 era when global profits went nowhere, yet equities rose 30%."

"Tremendous" Demand For 7Y Treasurys; Second Largest Buyside On Record

An ugly 2Y auction (with the highest yield since 2008) on Tuesday, a mediocre 5Y auction yesterday, and now a blistering 7Y auction, in which the Treasury sold $28 billion in "curve belly" notes at a high yield of 2.13%, stopping through the When Issued by a surprisingly strong 1.1bps, the highest since April.

A China Conspiracy Theory: "What If Beijing Is Behind The Entire Move?" SocGen Asks

"One interpretation is that China has been accumulating Treasuries to stop the Yuan appreciating too fast, buying Treasuries and driving yields lower than they would otherwise have been. Was that 2.03% 10year Note a function of expectations about the Fed, inflation and fiscal policy, or the result of Chinese buying in summer markets?"