Morning Call For Wednesday, Sept. 19

Overnight Markets And News

Dec E-mini S&Ps (ESZ18 -0.09%) this morning are down -0.04% and European stocks are down -0.05% in uninspired trade. Higher interest rates are weighing on equity prices after a jump in UK Aug consumer prices pushed the 10-year Gilt yield up to a 6-3/4 month high of 1.618%, which helped fuel an increase in the German 10-year bund yield to a 3-month high of 0.50%. Losses in European stocks were limited as carmakers rose after Eurozone Aug new car registrations climbed by the most since the data series began in 2004. Asian stocks settled mostly higher: Japan +1.08%, Hong Kong +1.19%, China +1.14%, Taiwan +0.90%, Australia +0.46%, Singapore +1.19%, South Korea +0.18%, India -0.45%. China’s Shanghai Composite climbed to a 2-week high on signs that state-sponsored funds entered the market and bought blue chip stocks. Japan’s Nikkei Stock Index rallied to a 7-3/4 month after Aug trade data showed Japan exports and imports both rose more than expected. Also, Japanese exporter stocks gained after USD/JPY (^USDJPY -0.02%) climbed to a new 1-3/4 month high, which boosts the earnings prospects of exporters.

The dollar index (DXY00 -0.08%) is down -0.20%. EUR/USD (^EURUSD +0.14%) is up +0.18%. USD/JPY (^USDJPY -0.02%) is up +0.05% at a new 1-3/4 month high as the yen weakened after BOJ Governor Kuroda said the BOJ won’t stop easing until inflation reaches the BOJ’s 2% target.

Dec 10-year T-note prices (ZNZ18 -0-020) are down -3 ticks at a new 3-3/4 month low.

UK Aug CPI rose +0.7% m/m and +2.7% y/y, stronger than expectations of +0.5% m/m and +2.4% y/y with e +0.7% m/m gain the biggest monthly increase in 1-1/2 years. Aug core CPI rose +2.1% y/y, stronger than expectations of +1.8% y/y.

Eurozone Aug new car registrations jumped +31.2% y/y to 1.134 million, the largest increase since the data series began in 2004.

The Japan Aug trade balance was in deficit by -444.6 billion yen, narrower than expectations of -483.2 billion yen. Aug exports rose +6.6% y/y, stronger than expectations of +5.2% y/y. Aug imports rose +15.4% y/y, stronger than expectations of +14.5% y/y.