Newscasts - Trading at Noon: U.S. manufacturing edges up in August, but the trend remains weak

Grail

03/09/2024 19:02

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Source: 'Reuters - Business videos'

Description: U.S. manufacturing contracted at a moderate pace in August amid
some improvement in employment, but a further decline in new orders and rise
in inventory suggested factory activity could remain subdued for a while.
Short Link: https://refini.tv/4gaL6lO

Video Transcript:

US manufacturing edges up in August from an eight-month low, but the trend
remains weak. Welcome to Trading at Noon. I am Ludovica Brignola. The 10-year
Treasury yields were down 8 basis points as the ISM Manufacturing Index came
out at 47.2. That is slightly less than the 47.5 expected by a Reuters poll
but higher than the reading for July. This adds to concerns that the US
economy may be slowing down. And equity markets opened lower today, with
rate-sensitive chip stocks leading declines. NVIDIA, Broadcom, Advanced Micro
Devices were all in the red. Investors are looking ahead to the jobs report on
Friday, expected to show that non-farm payrolls increased by a 160,000 jobs,
but also that unemployment fell to 4.2% in August after increasing 4.3% the
month prior.

We have seen the market rush to price in interest rate cuts from the Federal
Reserve. There is now a 100 basis points of cuts priced between September and
December. That does look a bit rich from where we are standing. We do not
think that necessarily will happen, and so we could see a bit of a
recalibration of rate expectations on the back of this data.

Let us take a look at stocks moving the most on the markets today. Tesla was
up nearly 1% after a report said it plans to produce a six-seat variant of its
Model Y car in China from late-2025. Meanwhile, the automaker's sales in China
logged their best month for the year so far in August. The company expects its
overall China sales to increase in the third quarter due to strong growth in
smaller cities. Brent oil prices fell 2% off the back of sluggish economic
growth China, the world's biggest crude importer. That overshadowed the impact
of halted production and exports from Libya. Off the back of all that, oil
majors were down on the stock markets. And staying with oil, Chevron has said
it has started a water injection operations at the company's projects off the
US Gulf of Mexico to boost oil and natural gas recovery, but its stocks were
also down today. US gene sequencing company Illumina has won its court fight
against a European Union investigation of its $7.1 billion purchase of cancer
diagnostic test maker GRAIL. The ruling is set to curb Brussels' merger
powers. Illumina founded GRAIL and spun it off in 2016 but re-acquired it in
2021. And shares of US Steel plunged today after Democratic presidential
candidate Kamala Harris opposed the planned sale of United States Steel to
Japan's Nippon Steel. Well, that is your Trading at Noon