Stock Market Update

The S&P 500 futures currently trade 17 points below fair value. 

Equity indices in the Asia-Pacific region had a mostly lower showing on Tuesday. China's trade surplus for August was a touch above expectations while Japan's Q2 GDP also slightly beat estimates. South Korea is planning to build a gas power plant and eight nuclear power plants in the U.S. as part of a $200 bln investment project. China will report its CPI and PPI for August overnight.

• In economic data:
  • China's August trade surplus totaled CNY809.30 bln (expected CNY805.00 bln; last CNY767.07 bln).
  • China's August imports increased 28.2% yr/yr (expected 30.0%; last 27.5%).
  • China's August exports increased 25.0% yr/yr, as expected (last 23.9%).
  • Japan's Q2 GDP increased 0.4% qtr/qtr (expected 0.3%; last 0.5%).
  • Japan's Q2 GDP capital expenditure decreased 0.9% qtr/qtr (expected -1.2%; last -0.7%).
  • Japan's Q2 GDP private consumption was unchanged qtr/qtr, as expected (last 0.3%).
  • Japan's Q2 external demand increased 0.5% qtr/qtr, as expected (last 0.3%).
  • Japan's July overall wage income increased 4.7% yr/yr (expected 3.9%; last 4.0%).
  • Japan's July overtime pay increased 3.1% yr/yr (expected 3.9%; last 3.4%).
  • Japan's July current account surplus totaled JPY2.52 trln (expected JPY2.46 trln; last JPY1.40 trln).
  • Japan's August Economy Watchers Current Index rose to 46.4 (expected 46.3; last 45.7).
  • South Korea's Q2 GDP increased 0.6% qtr/qtr, as expected (last 1.7%), and 3.7% yr/yr, as expected (last 3.6%).
  • Australia's September Westpac Consumer Sentiment fell 5.2% (last 6.0%).
  • Australia's July building approvals decreased 3.6% m/m, as expected (last 7.2%).
  • Australia's July private house approvals decreased 4.2% m/m, as expected (last 0.8%).
  • New Zealand's Q2 manufacturing sales volume increased 0.8% qtr/qtr (last 3.6%).

---Equity Markets---

• Japan's Nikkei: -1.7%
• Hong Kong's Hang Seng: -0.4%
• China's Shanghai Composite: +0.2%
• India's Sensex: -0.7%
• South Korea's Kospi: -0.6%
• Australia's ASX All Ordinaries: -0.9%

Major European indices trade near their flat lines while Spain's IBEX (-0.3%) and Italy's MIB (-0.2%) lag slightly. The European Central Bank is widely expected to announce a rate hike on Thursday and the market will evaluate the statement for the likelihood of another hike in December. There is some speculation that British Chancellor Healey could announce tax hikes in the Autumn budget address. Political turmoil is on the rise in Germany after AfD won a weekend election in Saxony-Anhalt, doubling its support.

• In economic data:
  • Germany's July trade surplus totaled EUR21.3 bln (expected surplus of EUR16.0 bln; last surplus of EUR15.4 bln).
  • Germany's July imports decreased 5.7% m/m (last 4.5%).
  • Germany's July exports decreased 0.8% m/m (expected 0.0%; last 0.9%).
  • France's July trade deficit totaled EUR6.7 bln (expected deficit of EUR6.0 bln; last deficit of EUR5.8 bln).
  • France's July current account deficit totaled EUR4.7 bln (last deficit of EUR1.6 bln).

---Equity Markets---

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