Stock markets waxed and waned as the Jackson Hole Symposium approaches. Investors were betting the possibility that Fed Chairman Ben Bernanke would hint further QE3 during his speech given recent mixed data. Meanwhile, sentiment was mixed as Catalonia might have become the third Spanish province to tap the l liquidity program, with 5B euro while speculations of further ECB action were intensified as President Draghi skipped Jackson Hole "due to the heavy workload foreseen in the next few days". Crude oil prices were relatively firm as driven by stronger euro and weaker US dollar during the day. The black gold was also supported by the storm season in the Gulf of Mexico with Tropical Storm Isaac upgrading to a hurricane and headed for New Orleans. This was the first time in 7 years when Katrina attacked the area and caused tremendous destruction. Also, oil prices rose as Iran denied that it would allow UN inspectors to investigate its nuclear sites. Gold retreated after failing to break above 1680. While QE3 hopes triggered buying, gains were pared on profit-taking.

The situation in Spain worsened as Catalonia announced that it would seek financial assistance from a regional financing facility. The size of the funding would be 5b euro, about one-third of the 18B euro the government created in July. Meanwhile, the country's final GDP data showed contraction of -0.4% q/q in 2Q12 with consumer spending down -1% and investment down -3%. According to Deputy Finance Minister Fernando Jimenez Latorre, economic contraction will probably continue in the second half of the year but some improvements would be seen in early 2013. As the market awaits the Jackson Hole Symposium on August 31-September 1, the ECB President Draghi said that he would not attend the forum due to "heavy workload" expected in coming few days. This has led to speculations that the President is engaged in preparation of the ECB meeting on September 6 and some new non-standard monetary easing would be announced.

While investors are eagerly awaiting Chairman Bernanke's speech at the forum, they are not very confident that something new would be delivered. Wall Street changed little yesterday with the DJIA and the S&P 500 losing -0.17% and -0.08% respectively. Consumer confidence in August dropped to 60.6 from 65.4 a month ago. The present situation index dipped to 45.8 from 45.9 in July while the future expectations index plunged to 70.5 from 78.4.

On the dataflow today, the US GDP probably grew +1.7% in 2Q12, revised up from +1.5% in the first estimate. Pending home sales might have gained +1.0% m/m in July after slipping -1.4% a month ago. Concerning US oil inventory, the industry-sponsored API estimated that crdue stock increased +5.5 mmb in the week ended August 24. Meanwhile, gasoline inventory fell -2.4 mmb while that of distillate added +1.4 mmb. The official Doe/EIA report would probably show that both crude and gasoline stocks fell -2 mmb while distillate inventory stayed unchanged.