Market Brief – Tuesday 9/15/20

Stocks gapped higher after reports small investors have increased their leverage following last week’s sell-off in the equity market. Treasury yields rose slightly in overnight trading along with crude oil. The dollar fell slightly in overnight trading.

Export prices rose +0.5% in August and improved to -2.8% from this time last year. Import prices rose +0.9% in August and improved to -1.4% from this time last year.

The New York Empire State Manufacturing Index improved to 17 in September from 3.7 last month and beating expectations of a 6.0 print as the manufacturing sector in New York appears to be coming back online.

Redbook same-store weekly retail brick-and-mortar sales fell -1.6% last week and fell to -1.2% from this time last year in a sign retail sales are rolling over.

Industrial production rose +0.4% in August and slowed to -7.73% from this time last year. Manufacturing production missed expectations by rising +1.0% in August.

Today’s $22 billion 20-year Treasury Bond auction was met with strong demand as foreign bidders took 60.7% of the auction and domestic bidders took 15.3% of the auction, leaving securities dealers with 24.0% of the auction or $5.288 billion. Yields fell following the auction.

Stocks closed higher but gave back some of their overnight gains in late trading. Treasury yields also closed higher ahead of tomorrow’s FOMC press conference where Fed Chair Powell is expected to detail the Fed’s plan to hold off on any monetary tapering until inflation exceeds 2%.

The American Petroleum Institute reported crude oil inventories as Crude: -9.517mm (+1.27mm expected), Cushing: -789k (+2.068mm expected), Gasoline: +3.762mm (-160k expected), and Distillates: -1.123mm (+600k expected). Crude oil traded lower in after-hours trading following the report.