Happy Jobs Day! Ed’s Daily Notes for March 7th   Leave a comment

job lolcat(hat tip to Feline Underground for the pic)

Time for another U.S. Monthly Employment Report today at 8:30 am EST. Here is what to expect, according to Bloomberg:

Nonfarm Payrolls – M/M change: Last month +113,000, Consensus +150,000, Consensus Range +80,000 to +203,000
Unemployment Rate – Level: Last month 6.6%, Consensus 6.6%, Consensus Range 6.4% to 6.7%

Bloomberg: Zombies Spreading Shows Chaori Default Just Start

More reason to worry about China:

The number of Chinese companies with debt double equity has surged since the global financial crisis, suggesting the first onshore bond default won’t be the last.

Publicly traded non-financial companies with debt-to-equity ratios exceeding 200 percent have jumped 57 percent to 256 from 163 in 2007, according to data compiled by Bloomberg on 4,111 corporates. The yield on five-year AA- notes leapt 13 basis points in two days to 7.82 percent on March 6, the most in almost four months, after Shanghai Chaori Solar Energy Science & Technology Co. (002506) said it won’t be able to fully pay an 89.8 million yuan ($14.7 million) coupon due today on its March 2017 bonds. Chaori Vice President Liu Tielong said in an interview today the company still can’t make the payment.

Bloomberg: Gold Defying Goldman Sachs With Coffee Percolating

Here is a commodities market update:

From drought in Brazil to the arctic blast that swept across North America, extreme weather drove coffee, sugar and natural gas into bull markets just as escalating political tension in Ukraine created supply risks for energy and grains. The rally for raw materials was a surprise to banks from Citigroup Inc. to Goldman Sachs Group Inc. that had forecast 2014 would mark a continuation of last year’s slump.

Commodity funds recorded inflows of $1.57 billion last month, the first increase since September, after withdrawals last year reached a record $43.3 billion, according to researcher EPFR Global. Investors who shunned gold as the metal slumped into a bear market in 2013 increased holdings through exchange-traded funds in February for the first time since 2012. Dryness in Brazil erased the prospect of a record coffee crop as prices jumped, after the longest slide in two decades.

“It’s a series of mostly unrelated factors that are catching commodities at a time when they’ve already been heavily sold,” said Paul Christopher, the St. Louis-based chief international strategist at Wells Fargo Advisors, which manages $1.4 trillion. “A lot of these factors are weather related and will fade. I don’t think this is a viable opportunity for a long-term investor. It’s more of a trading opportunity.”

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Posted March 7, 2014 by edmcgon in Economy, Market Analysis, News, Precious Metals

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