The debates caused the disappointing figures of job creation in the United States have not had, at this stage, big consequences on indexes. "Don't get me wrong: job creation disappointed in August, but the U.S. job market is actually very strong," Kepler Cheuvreux said in a weekly note. The numbers are the result of low candidate engagement, while job openings are at a premium, the financial intermediary adds. The real question remains how this statistic fits into the current context (pandemic, inflation, support plans, rates, bond market and what have you). Even financial professional seem to have a hard time getting a handle on the big picture at the moment because of the multiplicity of factors to be integrated.

The mix of low rates, economic growth and abundant liquidity is creating a favorable environment for financial transactions. In eight months, nearly $4 trillion of transactions were completed worldwide, the Financial Times points out based on Refinitiv data. The record of $4.3 trillion has a good chance of being broken. It dates back to 2007, a fateful year that led to the 2008 financial crisis. But past sequences don't often give a clue about future events in finance.

The most popular sectors are - surprise! - high tech (21.2% of transactions) and finance, neck and neck with industry (12% each). Listed real estate is also making a strong comeback, with deals favored by more affordable valuation levels due to the sectoral setbacks of the year 2020.

We are not out of the woods yet with monetary policy. After the Fed, it's time to move on to the ECB. The European Central Bank is holding its autumn meeting this week. It will communicate its position on rates and monetary policy on Thursday. The question of a reduction in its support plan, or at least the beginning of a debate on this subject, seems to be on the agenda with the good performance of macroeconomic statistics. Will the bank communicate on the subject on September 9? Nothing is certain yet, but Christine Lagarde will probably have a delicate communication exercise to carry out on Thursday, as she has not always been comfortable in this area.

Elsewhere, Asia seems to be experiencing a rebound. Until the end of July, the performances of the main local markets were mediocre, if not disastrous. Six weeks later, the picture is much better with the Japanese market up nearly 9%, while Hong Kong follows closely. The mainland Chinese market, which still shows a double-digit contraction, is still underperforming by more than 30% compared to the Nasdaq.

 

Today's economic highlights:

Another day without major statistics in the US. This morning, China released better than expected figures for its exports and imports. The Australian central bank kept its rates and monetary policy unchanged.

The dollar is up slightly to USD 0.8430. The ounce of gold is down to USD 1810. Oil is gaining ground at USD 68.25 per barrel WTI and USD 71.66 per barrel Brent. US debt yields are up two points to 1.34% on the 10-year, while the Bund yield is relatively stable at -0.37%. Bitcoin is still in good shape at around USD 50,975.

 

On markets:

* Deutsche Telekom announced Tuesday a share swap agreement with Japan's Softbank Group that allows it to increase its stake in its U.S. subsidiary T-Mobile to 48.4%.

* State Street announced Tuesday that it will buy the investor services business of Brown Brothers Harriman Bank (BBH) for $3.5 billion in cash.

* Goldman Sachs announced Monday that it is considering an initial public offering of its subsidiary Petershill Partners on the London Stock Exchange, a deal that could value it at more than $5 billion.

* The Boeing Company - The delivery of new 787 Dreamliner planes from the American aircraft manufacturer, suspended since last May, is not expected to resume before at least the end of October, the Wall Street Journal reported on Saturday. Ryanair said Monday that it has ended discussions with Boeing on a major 737 MAX 10 order because of a disagreement over the price of the aircraft.

* JD.Com - The Chinese online shopping group announced Monday that founder and CEO Richard Liu would become responsible for long-term strategy while a president would be in charge of day-to-day operations.

* Did Global - The Beijing municipal government denied on Monday that it was considering Chinese state-owned companies taking stakes in the ride-hailing giant.

* Match Group - Tinder's parent company gained 12.7 percent in pre-market trading after announcing it would soon be included in the Standard & Poor's 500 Index.

* Avantor - The laboratory equipment supplier announced Tuesday that it is buying peristaltic pump maker Masterflex for $2.9 billion in cash and stock.

* Qualcomm announced Monday that it will supply the Renault group with the chips needed to operate the digital dashboard of the new electric Mégane E-TECH, which is expected to go on sale next year.

The European Medicines Agency (EMA) announced Monday that it is reviewing data from Pfizer and BioNTech's COVID-19 vaccine for a booster dose six months after the second injection in people aged 16 and older.

 

Analyst recommendations:

  • Admiral: JPMorgan  reduced the price target of Admiral Group to 27.10 pounds sterling from 27.30 pounds and reiterated its neutral rating.
  • Amgen: Morgan Stanley cut its recommendation to equal-weight from overweight. PT rises 10% to $85
  • Asos: Goldman Sachs is keeping its Buy rating. The target price is reduced from GBp 6100 to GBp 5800.
  • Banner: D.A. Davidson & Co downgrades Banner Corp. to neutral from buy. PT up 6.2 % to $60
  • Cirrus Logic:  Barclays upgrades to overweight from equal-weight. PT gains 20% to $100
  • EnQuest: Jefferies upgraded from buy to hold with a target of 24 GBp.
  • Merck & Co: Morgan Stanley downgrades to equal-weight from overweight. PT up 10% to $85
  • Oracle: Jefferies retains its Neutral opinion on the stock. The target price has been revised upwards and is now set at USD 95, compared with USD 80 previously.
  • Phoenix group: JPMorgan lowered the price target of Phoenix Group to 7.09 pounds sterling from 7.93 pounds and maintained its neutral rating.