OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ15 +0.29%) are up +0.65% and European stocks are up +0.59% at a 1-week high on signs of stabilization in Chinese manufacturing activity that pushed up the price of oil (CLX15 +2.24%) by +2.42% and fueled a rally in energy and basic-resource companies. Copper prices (HGZ15 +0.26%) also climbed +0.56% to a 1-week high, which gave miners a lift with Anglo American Plc and BHP Billiton both up nearly 3%. Asian stocks settled higher: Japan +1.92%, Hong Kong and China closed for holiday, Taiwan +1.40%, Australia +1.80%, Singapore +0.39%, South Korea +0.81%, India +0.25%. An unexpected increase in the China Sep manufacturing PMI bolstered confidence in China's economic outlook and gave global stocks a lift, while a bigger than expected decline in Japan Q3 Tankan large manufacturing business conditions undercut the yen and gave Japanese stocks a lift on speculation that the BOJ may need to expand stimulus.
The dollar index (DXY00 -0.04%) is up +0.03%. EUR/USD (^EURUSD) is down -0.27%. USD/JPY (^USDJPY) is up +0.08%.
Dec T-note prices (ZNZ15 +0.01%) are down -2 ticks.
The China Sep manufacturing PMI unexpectedly rose +0.1 to 49.8, better than expectations of no change at 49.7. The Sep non-manufacturing PMI remained unch at 53.4.
The Japan Q3 Tankan large manufacturing business conditions fell -3 from last quarter to 12, a bigger decline than expectations of -2 to 13.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Sep Challenger job cuts (Aug +2.9% y/y), (2) weekly initial unemployment claims (expected +4,000 to 271,000, previous +3,000 to 267,000) and continuing claims (expected -12,000 to 2.230 million, previous -1,000 to 2.242 million), (3) final-Sep Markit manufacturing PMI (expected unch at 53.0, prelim-Sep unch at 53.0), (4) Aug construction spending (expected +0.5%, Jul +0.7% m/m), (5) Sep ISM manufacturing index (expected -0.5 to 50.6, Aug -1.6 to 51.1), (6) San Francisco Fed President John Williams' speech on the economic outlook to Salt Lake Area Community Leaders, and (7) Sep total vehicle sales (expected 17.60 million, Aug 17.72 million).
