Morning 8-31

  JPMorgan and Goldman Sachs economists hiked their Q3 GDP annualized growth tracking estimates to +27.5% and +30%, respectively, from +20.0% and +26.5%.

Also on Friday, BMO’s Belski reinstated his year-end S&P price target at 3,650, further adding that he sees the index climbing to 3,850 in the next 12 months.* (Yahoo Finance)

  (Bloomberg) — Soybean futures in Chicago advanced for the sixth day to the highest since June 2018 on strong demand from China and worries about deteriorating U.S. crop conditions. Grains also gained. China has stepped up purchases of U.S. farm goods since the
end of April, with soybean sales for delivery next season currently running at their highest level for this time of year since 2013. “Weekend rains disappointed and the upcoming week
looks like another dry one, but cooler,” said Matt Ammermann, a commodity risk manager at Stone. The USDA is likely to say in a weekly report later on Monday that soybean conditions worsened last week, he said.

Seasonals. Since 1950, September is the worst performing month of the year for DJIA, S&P 500, NASDAQ (since 1971) and Russell 1000 (since 1979). Sizable gains in September 2009, 2010, 2012, 2013 and 2017 have lifted Russell 2000 to second worst (since 1979). September’s performance does improve slightly in election years, but it is still negative nearly across the board. Only the Russell 1000 and Russell 2000 have been able to escape negative territory and post modest 0.2% and 0.8% average gains respectively in the last ten election year Septembers. (Almanac Trader) H/T Mizuho

  On his 90th birthday, Warren Buffett’s Berkshire announced it had acquired “slightly more” than 5% stakes (valued at roughly $6.63 billion) in each of the five Japanese trading companies, Itochu Corp (8001.T), Marubeni Corp (8002.T), Mitsubishi Corp (8058.T), Mitsui & Co Ltd (8031.T) and Sumitomo Corp (8053.T). Diversification from Apple? Maybe Japan is the new gold? Perhaps with a market that is “all in” on the reflation trade/yield curve steepeners, Japanese stocks is one of the best ways to express that trade. These firms offer sizable dividend payments and strong cash flows, and they also offer diversification away from the dollar. Following the news, Marubeni and Sumitomo ended up over 9%, followed by Mitsubishi and Mitsui at over 7%. Itochu rose 4.2% to a record high. Marubeni, Mitsubishi, and Sumitomo are still 10% down on the year, versus a 6% fall in the Topix. Buffett’s firm said it could raise them to 9.9% over time. (Bloomberg)

 Dollar  Index narrow range overnight trading roughly at Fridays lows, the Yuan is at a One  year high as  It trades at 6.8436.Plenty of shorts in DXY it seems primed for a bounce I’m watching 92.127 in Dollar for support and likely stretch that that down to 92 even. Month End today so possibly some games around the London Fix at 10:00 CST… in the 30 year yield 200 D MA comes in at 1.6643% yields have not been above the 200 D in 18 months…Soybeans +1.5% Corn +1.3%..Silver gaining for the 5th Month in a row Bloomberg telling us the longest monthly winning streak in 10 years  Just released German CPI missed expectations ,Italian CPI in line to lower is not news ECB likes to hear. Nat Gas -2.4% Oil Steady,Stocks sideways to lower and Fixed income in the red

 Economic Calendar: Highlight today Fed Vice Chair Clarinda Speech at 8:00 CST entitled “the Feds new Monetary policy Framework”


 China manufacturing data 6th consecutive above 50 and Services PMI data 31 month high, Another set of PMI data to be released tonight

India reported 78,512 COVID-19 infections today, more than any other country but fewer than Sunday when it posted the world’s biggest, single-day tally, as authorities looked to open more sectors of the economy. (reuters)

 Forty percent of Americans back President Trump’s threat to ban TikTok if it is not sold to a U.S. buyer, according to a Reuters/Ipsos national poll, suggesting that many support the effort to separate the social media upstart from its Chinese parent. (Reuters)

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