Markit

Stagflation Looms As PMI Shows Surging Costs And Sinking Growth

Following Manufacturing's drop, the US Services sector PMI disappointed in November, falling to its lowest since June (as business confidence tumbled to its weakest since February). Average selling prices soared as growth slumped setting the scene for a stagflationary future. ISM Services confirmed this weakness, tumbling to 3-month lows.

Tax Euphoria Fades As Tech Rout Spreads

One look at S&P futures this morning reveals an unchanged market, however it is again the violent sector rotation that is taking place behind the scenes that is the real story, with defensive sectors real estate, retail, food, utilities outperforming while investors continue to bail and book profits on tech stocks after sharp gains since the start of the year.

Key Events In The Coming Week: Jobs, Brexit, PMI, IP And More

The first full week of December is shaping up as rather busy, with such Tier 1 data in the US as the payrolls report, durable goods orders and trade balance. We also get UK PMI data and GDP, retail sales across the Euro Area, as well as central bank meetings including Australia RBA and BoC monetary policy meeting.

US Manufacturing's Hurricane-Rebound Is Over: New Orders Sink, Costs Soar

The brief rebound in US manufacturing after the hurricanes appears to have ended as Markit's PMI dropped from 54.6 to 53.9 as new orders slowed amid soaring inflation. For once ISM Manufacturing also agreed with PMI - dropping to its lowest since July - with employment and export orders sinking.

Global Stocks, US Futures Slide As Tax Bill Chaos Erupts In The Senate

Markets were thrown for a loop in the past 24 hours, with the Dow first soaring nearly 400 points on Thursday on expectations that tax reform was a done deal, when drama emerged just after the close when the Senate tax bill came this close to falling apart when the proposed "Trigger" was ruled as invalid, pushing a Thursday vote to this morning, and sending global stocks sliding over concerns of its passage.

Key Events In The Coming Week: Senate Tax Vote; Euro Inflation; GDP; OPEC, Fed Speakers

It's a busy week as traders return from the long Thanksgiving holiday, with inflation releases in the Eurozone and Japan. We'll also get the second estimate of US GDP, housing data and ISM manufacturing, UK monetary aggregates and PMIs in China. Finally, the Russia-OPEC meeting takes place in Vienna on November 30, while the Senate hearing of Fed chair nominee Powell and Yellen's testimony before Congress will be closely watched.

Key Events In The Coming Holiday-Shortened Week

It's a relatively quiet, holiday-shortened week, with volumes expected to grind lower as we head into the Thanksgiving holiday. Key economic releases are the FOMC minutes and the durable goods orders report, both on Wednesday. There is one speaking engagement with Chair Yellen this week.