5 Things We Watch – Manufacturing, Natural Gas, JOLTS, BoJ & China
Happy Wednesday, and welcome back to our 5 Things We Watch, where we as always run through 5 interesting topics in global macro relevant for the current and near-term market actions. We’ll as usual be short and concise, covering what has already happened this week, as well as what will happen next.
This week we are watching out for the following 5 topics within global macro:
- Manufacturing
- Natural Gas
- JOLTS
- BoJ
- China
1) Manufacturing to continue its strength until the new year?
This week gave us fresh ISM manufacturing numbers and as followers would know we have been bullish US PMI numbers in the manufacturing sectors for a couple of months now as Biden tries to reshore American interests.
The numbers from Monday once again came in hot and looking at crude oil as a leading indicator ISM will at the earliest start rolling over on a year/year basis around the new year. This is definitely also one of the reasons why we have yet to see the broad US equity index crater completely given the ISM’s correlation to SPX.
Chart 1: More tailwinds for ISM to come
BoJ likely intervened yesterday for the first time in a year, the American labor market looks stronger than feared and PBoC is looking to cope with domestic capital flights. Read more in this week’s edition of ‘5 Things We Watch’.
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