Stock Market Update

The stock market is on track for a higher opening, with the S&P 500 futures currently trading 60 points above fair value.

Equity indices in the Asia-Pacific region ended Thursday on a mostly lower note. South Korea will invest $350 bln in the U.S. as part of a trade deal that will result in a 15% tariff on imports from South Korea and no tariff on U.S. exports to South Korea. South Korea will also purchase $100 billion worth of energy products from the U.S. Separately, imports from India will be subject to a 25% tariff, starting tomorrow. The Bank of Japan's latest meeting concluded with no changes to policy.

• In economic data:
  • China's July Manufacturing PMI 49.3 (expected 49.7; last 49.7) and July Non-Manufacturing PMI 50.1 (expected 50.3; last 50.5)
  • Japan's June Industrial Production 1.7% m/m (expected -0.7%; last -0.1%). June Retail Sales 2.0% yr/yr (expected 1.8%; last 1.9%). July Housing Starts -15.6% yr/yr (expected -16.3%; last -34.4%) and July Household Confidence 33.7 (expected 35.1; last 34.5)
  • South Korea's June Industrial Production 1.6% m/m (last -3.3%); 1.6% yr/yr (last -0.3%). June Retail Sales 0.5% m/m (last -0.1%)
  • Hong Kong's Q2 GDP 0.4% qtr/qtr (expected -0.2%; last 1.9%); 3.1% yr/yr (expected 2.8%; last 3.1%). June Retail Sales 0.7% yr/yr (last 2.4%)
  • Australia's June Building Approvals 11.9% m/m (expected 1.8%; last 2.2%); 5.4% yr/yr (expected 8.0%; last 8.1%). June Private Sector Credit 0.6% m/m (expected 0.5%; last 0.5%) and June Private House Approvals -2.0% m/m (last -1.0%). Q2 Import Price Index -0.8% qtr/qtr (expected -0.5%; last 3.3%) and Export Price Index -4.5% qtr/qtr (last 2.1%). July Retail Sales 1.2% m/m (expected 0.4%; last 0.1%); Q2 Retail Sales 0.3% qtr/qtr (last 0.1%)
  • Singapore's Q2 Business Expectations 5.00 (last -6.00)

---Equity Markets---

• Japan's Nikkei: +1.0%
• Hong Kong's Hang Seng: -1.6%
• China's Shanghai Composite: -1.2%
• India's Sensex: -0.4%
• South Korea's Kospi: -0.3%
• Australia's ASX All Ordinaries: -0.2%

Major European indices are mixed. Italy's flash CPI for July was hotter than expected while Germany's full CPI report that will be released at 8:00 ET could also exceed expectations after regional readings showed accelerating inflation. Bundesbank President Nagel said that "the last mile of disinflation is the hardest" and that policy should not be loosened prematurely. BBVA and Societe Generale reported strong results while Rolls Royce issued strong guidance.

• In economic data:
  • Eurozone's June Unemployment Rate 6.2% (expected 6.3%; last 6.2%)
  • Germany's July Import Price Index 0.0% m/m (expected -0.2%; last -0.7%); -1.4% yr/yr (expected -1.6%; last -1.1%). July Unemployment Change 2,000 (expected 15,000; last 10,000) and July Unemployment Rate 6.3% (expected 6.4%; last 6.3%)
  • France's July CPI 0.2% m/m (expected 0.3%; last 0.4%); 1.0% yr/yr, as expected (last 1.0%). June PPI -0.2% m/m (last -0.9%); 0.2% yr/yr (last 0.0%) o Italy's June Unemployment Rate 6.3% (expected 6.4%; last 6.5%). July CPI 0.4% m/m (expected 0.1%; last 0.2%); 1.7% yr/yr (expected 1.5%; last 1.7%). June PPI 1.5% m/m (last -0.7%); 2.5% yr/yr (last 1.7%)
  • Spain's May Current Account surplus EUR6.44 bln (last surplus of EUR1.36 bln)
  • Swiss June Retail Sales 3.8% yr/yr (expected 0.2%; last 0.3%)

---Equity Markets---

• STOXX Europe 600: -0.3%
• Germany's DAX: -0.3%
• U.K.'s FTSE 100: +0.2%
• France's CAC 40: -0.4%
• Italy's FTSE MIB: -0.8%
• Spain's IBEX 35: +0.3%