Global wrap: US and European equities rallied – ANZ

In a market wrap,  analysts at  ANZ Bank New Zealand Limited (“ANZ”), explained that US and European equities rallied (0.4-0.8%), shrugging off declines in Asia.

Key Quotes:

“The USD rose against the G10 with CHF leading declines and falling 1.2%. US treasury yields rose 1-2bps across the curve. The euro also fell as questions over Italy’s budget continued, with the deadline for agreeing deficit targets looming. Oil rose 0.9% after US Energy Secretary said that US reserves won’t be used to expand global supply. Gold fell 0.8%. Quarter- and month-end flows are likely distorting market moves to some degree.”

DATA/EVENT PULSE

“MIXED: US data was a little mixed with the advanced trade balance widening to -$75.8bn in August, compared with -$70.6bn expected. It appears that corporates are accelerating their overseas purchases prior to tariffs. There was also a pickup in auto and consumer goods imports. Wholesale inventories were up 0.8%, suggesting some inventory build. GDP was unchanged at 4.2% y/y in Q2. However, core PCE ticked up to 2.1% from 2.0% previously. Durable goods orders rose 4.5% m/m, compared with 2.0% expected, but core orders fell 0.5% and shipments were also on the weaker side. The labour market is still strong, with initial jobless claims at 214k and continuing claims at 1,661k. And consumer confidence continues to push higher.

FIRMER: German September CPI was firmer than expected at 2.2% in September, up from 1.9% last month. Prices were up 0.4% m/m, suggesting upside risk to euro area inflation for September, which will be released tonight. Before the German data came out, euro area inflation was expected to tick up to 2.1% from 2.0%, with core expected to nudge up to 1.1% y/y from 1.0%. The preliminary release does not give a breakdown of the key drivers. German consumer confidence came in at 10.6, from 10.5. European consumer confidence in September was confirmed at -2.9.”