Archived IMT (2010.10.01)

USD WEAKNESS DEEPENS along with improved risk appetite brought about by rising Sep manufacturing PMI (4-month high in China) and better than expected Eurozone PMIs. The resulting rally in Asian and equities is keeping US equity futures well in the black (Dow futures +48 pts) at the expense of the USD. US Sep CONSUMER SPENDING exp +rose 0.4% vs exp +0.3% from +0.4%, while pers incomes +0.5% from +0.2%. Core PCE price index edged up to 1.5% from 1.4% which is the Feds favourite inflation gauge. Key data item of the day is Sep ISM manufacturing exp at 54.5 from 56.3, but could well surprise on the upside after yesterdays release of the Chicago PMI, which jumped to 60.4 from 56.7. EURUSD saw no resistance past $1.37 as it attained $1.3760 and I continue to stick with $1.3850. GBP mainly gaining on weak USD despite 10-month low in PMI, thus, be careful w/ pullbacks later in day ahead of ISM and consumer sentiment. Month/Quarter end rebalancing in portfolios to go on til end of day.