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Eurozone July flash services PMI 60.4 vs 59.5 expected

  
Analysis, Economy

Latest data released by Markit – 23 July 2021

  • Prior 58.3
  • Manufacturing PMI 62.6 vs 62.5 expected
  • Prior 63.4
  • Composite PMI 60.6 vs 60.0 expected
  • Prior 59.5

A solid bump in business activity with the strongest rise in over 15 years observed in the services sector. Supply chain disruptions dampened manufacturing output but overall conditions are still relatively robust to start Q3.

Prices for goods and services continue to run at a record pace, reaffirming higher cost inflation pressures. Meanwhile, backlog of work rose at a joint-survey record amid capacity constraints. Markit notes that:

“The eurozone is enjoying a summer growth spurt as the loosening of virus-fighting restrictions in July has propelled growth to the fastest for 21 years. The services sector in particular is enjoying the freedom of loosened COVID-19 containment measures and improved vaccination rates, especially in relation to hospitality, travel and tourism.

“Supply chain delays remain a major concern for manufacturing, however, constraining production and pushing firms’ costs higher. These higher costs have led to a near record increase in average selling prices for goods and services, which is likely to feed through to higher consumer prices in coming months.

“The survey also highlights how the delta variant poses a major risk to the outlook. Not only have rising case numbers led to a slide in business optimism to the lowest since February, further covid waves around the world could lead to further global supply chain delays and hence ever higher prices.”

Fed’s Powell rated as the most negative of the last three chairs of the Bank

  
  Analysis

Reuters report on research using artificial intelligence and voice analytics that scores current Federal Reserve System Chair Powel the most negative of the ;last 3 chairs.

And Yellen having the most neutral tone, and ... Ben Bernanke before that a comparative cheerleader.
🙂
The authors of the research … found that the Fed chair’s emotional tone at news conferences influences stock prices independent of the meaning of the words used
  • The effect, as much as 200 basis points on the S&P 500
bernanke yellen

Just waking up? Here’s the TL;DR version of the European Central Bank decision

  
  Analysis

The ECB did not change any policy setting. The ECB provided long-winded forward guidance, the TL;DR on this is that rate hikes from the Bank are way, way off in the future – don’t even think about thinking about it. PEPP … will continue at its current pace in addition to the asset buying program already in place.

At her presser, ECB President Lagarde hinted a debate over QE may occur at the September meeting (this meeting will be accompanied by the release of new forecasts).

North American equities rise for the third day but gains were modest

  
Analysis, Global Indices

Closing changes in North America

  • DJIA up 0.1%
  • SPX up 0.2% (9 points to 4367)
  • Nasdaq +0.3%
  • Toronto TSX Composite -0.1%
I would have expected to see some selling given the strength of the rally in the past two days, particularly when Treasury yields turned lower. Instead, the dip buyers stepped up and won the day. Overall, today doesn’t change the technical picture.
Closing changes in North America

There’s two ways we learn things, the easy way, and the hard way.

  
Analysis, Education

If we learn things the hard way the FIRST time we climb up off of the pavement — that is the definition of a windfall.

Learning things the easy way is to accept facts like an obedient database. The only payoff to learning things the easy way happens when our perspective on the matter at hand altered such that we see it in its proper light and thus actually understand it, rather than merely as data.

To convey ideas to other human beings, we must amend their perspective, their point of reference on the matter, to see it anew from an entry point that they will understand it. To spare them the inevitable beatings of otherwise learning it the hard way is such a gift.

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