Morning Roundup

By Mark Masterson on September 24, 2015

Good morning,

Below are the news items moving markets today…..

Executive Summary:

Global markets continue to slide lower overnight.  Asian markets were mixed with China up almost 1%, while the Japanese Nikkei fell 3% after the previous holiday sessions.  Europe is sharply lower on the VW auto scandal – which appears to be spreading.  US futures are also lower by about 1%.  Oil is now falling again as growth concerns continue to mount.  In the US, the economic data continues to point to weakness….

First, jobless claims rose.  It is presented as a victory as they rose less than expected – but they rose none the less…..INITIAL JOBLESS CLAIMS CLIMB TO 267,000 (272,000 Estimated) http://read.bi/1KSXVhP

US weekly jobless claims total 267,000 vs 271,000 estimate

That was followed by another weak durable goods orders report…..Durable goods orders fall 2% in August (-2.3% expected) http://read.bi/1JrtOsf

Again, these things are reported positively as they slightly beat the expectations.  Yet, that is the 7^th consecutive month of decline for durable goods.  They are down over 20% year over year.

The data continues to suggest the slowdown continues in the US  –  likely driven by the slowdown overseas.  Janet Yellen has a speech this morning.  Perhaps she will address it. Janet Yellen to speak at UMass on Thursday (Daily Collegian)

As Yellen continues to highlight just how strong our economy is (yet never raises rates, because she and the Fed knows that the happy talk is not entirely true), the rest of the world continues to cut rates and devalue their currencies.  Below is last night’s installments….

• Norway Cuts Rates to Record Low to Save Economy From Oil Slump (BBG)
• Taiwan Cuts Rate for First Time Since 2009 as Exports Falter (BBG)
• A Big Bet That China’s Currency Will Devalue Further (NYT)

This morning, US economic bell-weather Caterpillar announced that it will be cutting 5000 jobs, and lowering guidance.  Again – not what you see during economic expansions.

Caterpillar to cut up to 5,000 jobs; lowers 2015 revenue guidance

CATERPILLAR WARNS: Bad news is ‘converging’ and now we have to make some major changes http://read.bi/1Fw8mY0

Articles of Interest:

• Stocks slip for fifth straight day, euro holds steady (Reuters)
• VW recall letters in April warned of an emissions glitch (Reuters)
• VW Cheating Scandal Threatens to Ensnare BMW as Probe Widens (BBG)
• Pope Francis set to address fractious U.S. Congress (Reuters)
• Debt Relief for Students Snarls Market for Their Loans (WSJ)
• Don’t Expect a Fed Hike Anytime Soon – David Rosenberg, National Post
• Revisiting Yellen’s Bubble Doctrine – Jeffrey Snider, Alhambra Partners

Charts of the day:

Why the cuts at CAT…..

Here’s one of the most painful charts you’ll ever see, via @bespokeinvest http://read.bi/1Lzakbd 

Quote of the day:

Success and failure are not overnight experiences; it’s all the small decisions along the way that cause people to fail or succeed.

Tony Robbins