Trade the News Market Internals Update at 12:00ET

Dow +110 S&P +12 NASDAQ +32

***Economic Data***

– (TU) Turkey Central Bank leaves the Benchmark Repo Rate unchanged at 5.75%; As expected
– (HU) Hungary Central Bank leaves the Base Rate unchanged at 6.00%; As Expected
– (US) ICSC/GS weekly chain store sales w/e Aug 20th: -1.0% w/w; +3.0% y/y
– (CA) Canada Jun Retail Sales M/M: 0.7% v 0.7 %e; Retail Sales Less Autos M/M: -0.1% v +0.1%e
– (US) Redbook Retail Sales w/e Aug 20th: +4.4% y/y; Aug MTD: +0.2% v July
– (BR) Brazil July Current Account: -$3.5B v -$3.5Be; Foreign Direct Investment (FDI): $6.0B v $4.0Be
– (EU) Euro Zone Aug Advanced Consumer Confidence: -16.6 v -12.4e
– (US) Aug Richmond Fed Manufacturing: -19 v -5e
– (US) July New Home Sales: 298K v 310Ke
– (US) FDIC Q2 quarterly banking profile: Troubled Bank List 865 v 888 q/q, first decline in troubled institutions since Q3 of 2006

– US equities are gaining this morning despite early headwinds stemming from the banks, Europe and economic data. As anticipation builds for some sort of action to be announced by the Fed at the Jackson Hole symposium later this week, many commentators are warning traders to tamp down their expectations. Indeed, Fed Governor Fisher reiterated that there is plenty of liquidity in the US financial system and warned that Chairman Bernanke is “not the tooth fairy.” In Europe, more static is emerging on the Greek backstop as Finnish PM Katainen threatened that his country might drop out of the bailout if it does not receive collateral commitments. Another regional Fed manufacturing survey, the August Richmond Fed Index, was much weaker than expected. Shares of Bank of America spiked down 6% as another wave of fear over the bank’s capital position washed over markets, prompting Rochedale Analyst Dick Bove to state that he does not see any reason for Bank of America to raise additional capital. Gold spiked to fresh record highs overnight, topping $1,911. Spot gold is around $1,875 currently. Crude is flat on the session around $84. US Treasurys began the session in the red but have largely recaptured losses. The US 10-year yield is back below 2.1%.

– Shares of medical device maker Medtronic are up nearly 5% this morning after the firm’s new CEO, Omar Ishrak, outlined his vision for the firm on the earnings conference call last night. Ishrak said he would move to expand more aggressively overseas and boost efficiencies. Q1 results at Medtronic were right in line with expecatations, and the firm reaffirmed its FY12 guidance. HJ Heinz narrowly beat Q1expectations and reaffirmed its FY12 guidance, although its earnings outlook for Q2 was quite soft. Shares of HNZ are down 3%. Corinthian Colleges offered a disastrous outlook for its Q1 with Q4 earnings this morning, with profit and new student growth seen deep in the red. COCO is down more than 13%, with other for-profit names down sharply as well.

– CDS on peripheral euro zone nations widened out this morning although the euro held firm, leaving traders puzzled as to what was leading the market. EUR/USD remained close to the upper end of its option barrier resistance of 1.45 but various comments from officials eventually weighed on sentiment. Former Fed Chairman Greenspan commented that the euro was “breaking down,” adding that some collateral held by euro area institutions was questionable; these comments came at about the same time as the Finnish PM’s threats. Yields on the Italian and Spanish 10-year government bonds continued to test the key 5% level that has been the ceiling since the ECB renewed its gov’t bond buying program.

***Looking Ahead***

– 11:30 (US) Treasury to sell 4-Week Bills
– 11:30 (US) Treasury to sell $25B in 52-Week Bills
– 12:45 (CA) Bank of Canada’s Boivin speaks at CABE
– 13:00 (US) Treasury to sell $35B in 2-Year Notes
– 15:00 (AR) Argentina July Trade Balance: $800Me v $1.0B prior
– 15:00 (AR) Argentina Q2 Unemployment Rate: 7.3%e v 7.4% prior
– 16:30 (US) Weekly API energy inventories

This information was brought to you courtesy of TradetheNews.com, for your free trial Click Here