Markets Climb, Jobs Hold, Trump's Wobbles
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What do the revised European PMIs and US ISM services data indicate about the current economic recovery?
The revision to PMIs show that Europe is on a slow climb back, but the US services ISM was also stronger. So there's a lot to be positive about this morning. Although Donald Trump is facing some challenges, New York voted in a young Muslim man as their mayor, and the Republicans hardly got a look in what's that mean for midterms. And the Supreme Court has started the process of challenging President Trump's emergency tariffs. But aside from that, markets are in positive. Mood equities are up, treasuries are being sold off. It's Thursday, the 6th of November 2025. It's the morning call from NAB. Good morning. Well, not much going on with the US dollar, but the yen is down 0.3%. The Aussie uh dollar is up 0.3%, up uh over sixty-five US cents now.
Big moves in bond yields up seven basis points for ten year treasuries, up to four point one six percent. Aussie ten years, which fell to four point three one percent yesterday, are back up six basis points today to four point three seven percent. US equities are back as if we ever doubted it. Uh not point nine percent for the Nasdaq, not point seven percent for the S P, one point four percent for the Russell two thousand, and oil is weaker. Brent is down one point one percent to sixty-three seventy-five, WTI losing one and a quarter percent, concerns of supply outstripping demand. The story there, of course, as we've been talking about. And Nabs Rodrigo Catrill is uh with me today. I guess I mean it's not just supply and demand, that is
volatility and uncertainty. I mean gold is up a fair bit today as well. So, you know, there's uh there's still lots of question marks, aren't there?
Um morning Phil. Yeah, a fair bit of question marks. But uh do you know, uh there are sort of arguments to to be a little bit more calm about what's going on in the equity market. Um uh the earnings reporting season has been, uh, broadly speaking quite positive. Um, you know, uh many companies are reporting growth in uh in earnings that are even go beyond revenues. So so it is the the the background is positive in that sense. And and even when you look at
How are equity markets, treasury yields, and commodity prices reacting this morning?
um what's going on um in in in the labour market and we'll talk about that a little bit later, uh there's no signs or clear signs that there's labour market weakness. So again that sort of approach of steadiness if you like from from the Fed chair Powell. and and other Fed speakers is is is corroborated by the data. And of course we also had the ISM which is was quite positive. So you look at the macro picture in the US and you look at the ANIS picture and then you go like, well, it's actually not so bad. So um it's obviously the issue around valuations and how elevated they are that creates a little bit of uncertainty. Um but overall um you know you can point to to signs many signs to to be positive.
Well the ISM services index, yeah, fifty two point four when fifty point eight was expected, so definitely an upside surprise. And then uh we've seen uh this big big move in in bond yields, bit of a uh uh bond sell off. Um that was has been related to a a Treasury uh their quarterly refunding announcement. Wasn't anything new in that, was there? Um new securities d w the being issued didn't surprise anyone. It was just a point that was made that discussions are underway about increasing auction sizes depending on structural demand and cost risk assessments, which seems to have been taken as well, there's going to be more of them and that's pushed.
I I suppose the the good news is that the no change are expected over coming quarters, but they did make the reference that eventually that there will have to be an increase, but not not imminently. Um but certainly uh the combination of of those news alongside that the ISM, which not only beat expectations but it's probably also worth emphasizing that you look at the details of the ISM and and it's quite quite broad. base, you know, uh in terms of the the sub indices uh jumping from uh including prices paid, which is sort of the other kind of inflationary uh takeaway from there.
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Chapters
5 chapters
1
What do the revised European PMIs and US ISM services data indicate about the current economic recovery?
0:01–2:02
2
How are equity markets, treasury yields, and commodity prices reacting this morning?
2:02–6:13
3
What is the outlook for US earnings season and labour market strength according to the hosts?
6:13–10:18
4
Why did ADP payroll numbers cause a spike in bond yields and what does it mean for rates?
10:18–14:13
5
How might the revised German and US services PMIs affect the convergence of European and US growth?
14:13–16:54