Prices what prices, today’s CPI will tell us.

Yesterday’s US Producer Prices came in slightly hotter than expected, but a slight downward revision to the previous month helped the market brush off the implications while it waits for today’s consumer prices report. It is beginning to feel like a touch of euphoria is entering the market psyche. GameStop, a stock that apparently is the plaything for meme writer “Roaring Kitty”, jumped over 200% in response to a tweet, sending short covers to run for the hills. I’m not sure I understand the whole thing, but I guess someone’s pain was someone else’s gain. Why anyone plays in that pool is a mystery to me.

The UK’s employment report saw unemployment rise slightly as wages grew around 6% year over year. Fewer people are being paid more, I guess. Recently, there have been signs that the UK economy is picking up; a continued rise in real spending power will undoubtedly help support that view. Welcome, that news is higher wages do, however, muddy the interest rate picture somewhat. Job openings fell further. There is a growing hope the Bank of England may cut rates as early as next month, but rather as the Fed may not want to be seen to be too active on monetary policy ahead of the US election, the Bank of England will face the same dilemma as we get closer to the year-end and a UK election.

According to John Arthurs, writing in his daily Bloomberg comment, the latest Merrill Lynch fund manager survey, an oft-quoted popular measure of fund manager sentiment, shows investor sentiment at its most bullish in almost three years, as the possibility of a hard landing is 10/1.

Equity markets are once again starting the day on a positive note as we await the latest US inflation report.