Guest Post: Wednesday
Markets are trading quietly this morning waiting for Bernanke's testimony in front of the House Financial Services Committee. I'm interested in any unexpected remarks from the Q&A section. Bernanke's prepared remarks reiterated the Fed's intent to remain data dependent, primarily focusing on the unemployment and inflation objective, nothing new or surprising here. Comments from the chairman weakened the dollar causing an early rally in metals.
In economic news, June housing starts came in well below expectations and building permits also disappointed. An interesting fact: housing starts had the biggest miss since January 2007, and the permits number is the largest miss in history.
In corporate earnings, Bank of America (BAC) beat earnings on in-line revenue and trades slightly higher. Novartis (NVS) trades 1.4% lower after missing earnings and revenue. Abbott Labs (ABT) reported an earnings beat on below-consensus revenue.
Across the pond, the Bank of England held a unanimous vote to maintain the key interest rate and asset purchases of GBP375 billion. More financial chaos in Greece as they now may be looking at a EUR10 billion funding gap.
Asian markets were mixed in the overnight session. China's ministry of commerce commented that their appreciating currency has lowered the country's cost advantage. Trade conditions were described as 'severe'.
10 year yields are lower at 2.48% and the VIX is trading at 14.14.
Written by: Nicholas Mueller