US EARLY MORNING: Equity futures are a little higher; US jobs report later expected to show cooling payrolls growth, but labour market proxies suggest scope for upside vs consensus

US PRE-MARKETS: US equity futures are trading a little higher after heavyweight earnings from Apple (AAPL) and Amazon (AMZN) afterhours on Thursday; the former disappointed expectations with declining sales for the third straight quarter, and fell just over 2% in extended trade (AAPL has a 7.5% weighting in the SPX, and a 11.6% weight in the NDX); the latter reported sales and revenue which topped expectations, and issued upbeat guidance (AMZN has a 3.0% weighting in the SPX, and a 5.1% weight in the NDX). Today's focus shifts onto economic data, with the key US jobs report due - it is expected to show a cooling rate of payrolls growth, but whispers and other proxies (like the unreliable ADP data series, for instance) suggest some potential for an upward surprise; our preview is below. Elsewhere, the OPEC JMMC meeting will take place; recent reports have suggested that the Saudis are likely to roll-over their voluntary supply curbs through the end of September (our preview is here). Treasury yields are mixed, with the short-end seeing yields up a couple of basis points, while the long-end is seeing yields decline by a couple of basis points. The Dollar Index is slightly above neutral.

PREVIEW - US NONFARM PAYROLLS (13:30BST/08:30EDT): The rate of payroll growth is expected to slow in July, while measures of wage growth are seen cooling further. Analyst whisper numbers and gauges of the US labour market strength are supportive of a decent reading: ADP's gauge of payrolls surprised to the upside once again, though many analysts dismiss the data series as a reliable forecaster for the NFP data; weekly claims data has trended lower relative to the June survey week; PMI surveys allude to healthy labour market conditions, and consumers have confidence in the outlook for the labour market. And tracking estimates are also above what the consensus predicts. Ahead, payroll additions are expected to ease further, but Fedwatchers still suggest that a print in July that is in line with the consensus would still likely keep the prospect of another FOMC rate rise in play. (Newsquawk)

WEEKLY FLOWS: BofA's weekly flows report saw its Bull & Bear indicator rise to 4.1 from 4.0, with the upward trend over the last six weeks driven by EM stock inflows, improved credit technicals and bullish hedge fund positioning. US equities have now seen inflows for the past two weeks (USD +0.3bln in the latest week), Europe has seen outflows for the past 21 weeks (+3.3bln in the latest week), Japan inflows recommenced this week (+1.0bln), while EM has now seen inflows for the last four weeks (+4.1bln this week). In fixed income, investment grade inflows have now been registered for the past two weeks (5.9bln this week), Treasury inflows have been seeing inflows for the past 25 weeks (2.5bln latest), while EM debt saw its first outflows in the last three weeks (of 0.9bln this week). 

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04 Aug 2023 - 09:30- EquitiesData- Source: Newsquawk

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