Stock Market Update

The S&P 500 futures currently trade 18 points below fair value. 

Equity indices in the Asia-Pacific region started the week in mixed fashion. The Nikkei was a standout, rebounding from Friday's post-BOJ losses despite the 10-yr government bond yield hitting its highest level since July 2007. China's Shanghai Composite managed a modest gain following the PBOC's expected decision to leave the one-year loan prime rate and five-year loan prime rate unchanged at 3.00% and 3.50%, respectively. Separately, there was a stir after the Trump administration announced there will be a $100,000 fee for H-1B visas. Some of the initial angst was tempered with the clarification that the fee is a one-time fee (not per year) and applies to new petitions (not existing H-1B visa holders).

• In economic data:
  • Hong Kong's August CPI 0.1% month-over-month (prior 0.6%) and 1.1% yr/yr (expected 1.1%; last 1.0%)

---Equity Markets---

• Japan's Nikkei: +1.0%
• Hong Kong's Hang Seng: -0.8%
• China's Shanghai Composite: +0.2%
• India's Sensex: -0.6%
• South Korea's Kospi: +0.7%
• Australia's All Ordinaries: +0.5%

Major European indices have started the week with a mostly defensive posture. Major bourses are lower, absorbing some profit-taking activity and guidance warnings from Porsche and Volkswagen. Porsche cited the impact of tariffs, weak EV demand, and a slowdown in China as the basis for cutting its sales return outlook and tempering its operating profit expectations. Volkswagen expects a EUR5.1 billion total impact. Separately, check-in operations at airports in London, Berlin, Brussels, and Dublin were disrupted following a cyberattack on Collins Aerospace. ECB member Stoumaras suggested the rate cut cycle is likely over, barring a big drop in growth or inflation. That view has been an underpinning factor for the euro.

• In economic data:
  • There was no economic data of note

---Equity Markets---

• STOXX Europe 600: -0.1%
• Germany's DAX: -0.7%
• U.K.'s FTSE 100: flat
• France's CAC 40: -0.3%
• Italy's FTSE MIB: -0.2%
• Spain's IBEX 35: -1.4%