Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets in the day ahead. Today is Monday, Aug. 28.
State of Play
Chinese authorities rode in over the weekend to shore up that country’s financial markets, cutting a tax on trading and pledging to do more to revive its economy. Stock markets across Asia are up as a result, but only by about 1% or so. As of 0625 all is pretty quiet in the US:
Stock futures are flat, with no major US index moving more than 0.2% from the break-even point;
Commodities are unchanged. Copper is tellingly not moving at all, the best indication that investors aren’t impressed with the move by Chinese authorities. WTI crude oil is unchanged trading around $80/barrel;
Bonds are selling off at the short end of the curve, with the yield on the 2-year up 5 basis points to 5.10% (yields move inversely to prices). That’s the highest it’s been since the mid-2000s. The 10-year yield is unchanged at 4.25%.
Known Events
There is absolutely nothing on the calendar today. It’s actually a pretty slow week, with non-farm payrolls on Friday the lone data point worth mentioning. Would expect things to be slow all week. It’s the last unofficial week of summer, after all, and traditionally one of the slowest of the year.
The Bottom Line©️
Seeing how there’s nothing going on, we can talk about some of the concerns that have been weighing on investors this past month.
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