EmailIt is December 3 -- the first trading day of the new month -- and everyone is still talking about you know what. That thing we need to rise above... that something we can't go over... that issue we just know has some type of marketing angle for The North Face.
We're not going to say "it" because there is nothing new to say about "it."
There is a stretch to attach some significance to comments made by political leaders over the weekend about "it," but those comments didn't shed any light on "it" that hasn't already been seen. One side is waiting for the other while both sides are telling each other how things must go down.
That thing that will remain unsaid today is still unsettled and there isn't any convincing information to suggest it will be settled today, tomorrow, or even by the end of the week.
Nonetheless, the S&P futures are trading 0.5% higher today, presumably on a sense that a compromise on "it" will eventually be struck, thereby allowing everyone to place their crampons back in their North Face skin pocket (only $29.00 at a North Face store near you).
All kidding aside, the cash market should open higher today, but that has as much to do in our estimation with market mechanics as it does with anything else.
The first trading day of a new month often sees new inflows. With the positive finish at the end of November, it is understandable that the buying interest would carry over as December begins.
The S&P futures gathered some steam this morning when the euro and European bourses started to move higher. That move followed reports of Greece laying out a framework for a bond buyback plan, and updated PMI readings for November that were better than feared.
Specifically, the Eurozone PMI remained unchanged from the preliminary reading of 46.2 seen two weeks ago. That is up from 45.4 in October. The unspoken message in the headline number is that a reading below 50 is indicative of contraction. In effect, the decline in the manufacturing sector is continuing, just at a slower rate than seen in October.
PMI data for China, on the other hand, tipped back into expansion mode, with the HSBC PMI reading moving to 50.5 from 49.5. That is the first reading above 50 since October 2011. Interestingly, China's stock markets were all notable losers in Monday's trading.
The November ISM Index, which is a survey of manufacturing activity in the US, is due at 10:00 a.m. ET (Briefing.com consensus 51.2; prior 51.7). It will be accompanied by the October Construction Spending report (Briefing.com consensus +0.4%; prior +0.6%). Auto sales for November will be released throughout the day.
This will be an important week of economic reporting, punctuated by the November Employment Situation report on Friday.
It will also be an important week because of "it" and what is said about "it."
(Disclosure: today's note was not sponsored by The North Face)
