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Market Brief: Worst Manufacturing PMI In A Decade Slams Risk Appetite

Published 10/02/2019, 12:46 AM
Updated 07/18/2024, 03:38 AM
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Daily % Candles

  • FX: The safe haven Swiss franc was the strongest major currency on the day, while the risk-sensitive Australian and New Zealand dollars were the weakest. AUD/USD dropped to its lowest level since March 2009, the depths of the Great Financial Crisis, before recovering a bit intraday.

  • Reports initially suggested that the EU was willing to consider a time-limited backstop on the Irish border, but an EU spokesperson subsequently denied the speculation.
    • US data: The September ISM Manufacturing PMI report came in at just 47.8, below both the 50.0 reading expected and last month’s 49.1 print; this represents a 10-year low in the key economic gauge. The details of the report weren’t any better, with employment falling to 46.3 and new export orders dropping to just 41.0.

    • Commodities: Gold gained nearly 1% on the day. Oil ticked lower.
    US Cash Indices % Change

  • US indices closed roughly -1% lower across the board after the weak Manufacturing PMI report.
    • All eleven major sectors fell on the day. Utilities Select Sector SPDR (NYSE:XLU) fell the least, while the manufacturing-heavy Industrial Select Sector SPDR® Fund (NYSE:XLI) sector fell by the most, over -2%.

    • Online brokers including TD Ameritrade Holding Corporation (NASDAQ:AMTD)(AMTD, -26%) and E-TRADE Financial Corporation (NASDAQ:ETFC) (ETFC, -16%) were clobbered after rival Charles Schwab (NYSE:SCHW, -9%) announced it would end commissions for online stock, ETF, and options trades.

  • Two of 2019’s biggest IPOs, Uber (NYSE:UBER, -4%) and Lyft (NASDAQ:LYFT, -4%) both hit fresh record lows today as selling pressure mounts.
  • Ford Motor Company (NYSE:F) fell -3% after booking an impairment charge of $800-900M related to a sale of its assets to an Indian automaker.
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