11 August 2011 at 7:14 GMT
It promises to be another action-packed day in the markets with equity futures up 2 percent after Wednesday's massive sell-off led by financials due to rumours that Societe General was in trouble. Rumours that were denied.
The economic calendar does not provide the markets with much and as such the road is paved for another day driven by speculation and rumours.
U.S. Trade Balance: the balance of trade of the world's largest economy is expected to show a slight strengthening in June with consensus expecting the deficit to narrow to $48 billion from $50.2 billion in May. Like inventories - Wholesales Inventories, part of overall inventories, disappointed yesterday with a 0.6 percent increase vs. 1 percent expected and a downward revision to May - the Trade Balance figures were estimated in the GDP report for 2Q released two weeks ago, and hence this report also has the potential to cause a revision to GDP when the second report in 2Q GDP is released later this month.
Last month's report for May saw a sharp widening in the deficit to $50.2 billion from 43.6 billion in April primarily driven by oil prices. Since then crude has lost momentum with a decline in roughly 5 percent in June explaining consensus's forecast for a narrower deficit in today's report.
U.S. Jobless Claims: Initial Jobless Claims were quick to signal the current weakness in the economy rising above the 400,000-mark in the second week of April and they have since not peeked back down below this level (after last week's revision), but the trend is suggesting some improvement in this series now though we still have far to go. While June saw claims average 428,000 the figure dropped to 412,000 with the last two weeks recording 400,001 and 400,000. Consensus remains cautious though with an expectation of 405,000 while Continuing Jobless Claims are also expected to be roughly unchanged (3.725 million vs. 3.730 prior).