EMISSIONS: BNEF Sees Bullish Signals for EUAs Ahead of Winter

• Stocks are holding steady (SPX eminis) to mixed early Tuesday, off lows while holding to narrow ranges after Monday's modest decline. Currently, the DJIA trades down 15.51 points (-0.03%) at 45273.75, S&P E-Minis up 1 points (0.02%) at 6457.25, Nasdaq up 32.8 points (0.2%) at 21486.44.
• Industrials and Information Technology sector shares led gainers in the first half:  GE Vernova +3.02%, Boeing +2.04%, General Electric +1.81% and Howmet Aerospace +1.78%.
• Leading tech stocks in the first half included: Palantir Technologies +2.30%, Advanced Micro Devices +2.26%, Monolithic Power Systems +2.21% and QUALCOMM +1.92%.
• On the flipside, Consumer Staples and Communication Services sector shares underperformed in the first half: Keurig Dr Pepper -2.99%, Brown-Forman -2.80%, Bunge Global -2.50% and Archer-Daniels-Midland -1.90%.
• Energy stocks weighed by a drop in crude prices (WTI -0.77 at 64.03): Devon Energy -1.29%, Diamondback Energy -1.23%, EQT -1.02% and Coterra Energy -0.98%.

US President Donald Trump is shortly due to convene a meeting of his Cabinet at the White House. LIVESTREAM. The White House press pool will be in the room for questions at the top of the meeting, most of which are likely to concern Trump’s move to fire Federal Reserve governor Lisa Cook.

• Trump announced on Truth Social yesterday that he had removed Cook from her position, “effective immediately,” citing ‘for cause’ over “false statements on one or more mortgage agreements.” Most outlets have reported the move as an “attempt” to fire Cook, rather than a done deal, reflecting uncertainty over the legality of the firing.
• The Post notes: “The firing, if successful, could give Trump a majority of allies on the Fed board and allow him to fulfill his goal of lowering interest rates, even as the Supreme Court has pushed back on his attempts to exert direct control over the independent and powerful body.”

The Richmond Fed's 5th District surveys of manufacturing and services firms showed an improvement in current activity across the board, though it was more definitive in the case of services. The Richmond Fed characterized the manufacturing survey as showing activity "remained soft", while that of services "improved slightly". In addition, manufacturing firms reported stronger price pressures than services firms, which may help account for the sectoral divergence.

• The manufacturing composite index rose to a 5-month best -7 in August from an 11-month low -20 prior. New orders stood out with a jump to -6 from -25 prior, marking a 6-month high, while shipments, employment and wages also improved.
• That said, expectations fell sharply, to a 5-month worst -10, from -2 prior, with capex falling as well. Local business conditions indices largely mirrored the aggregate indices.
• The services local conditions composite showed significant improvement: at 6 in August, it marked the highest level since December 2024 and a 5th consecutive month of improvement (-8.0 prior), and expectations also improved for a 5th month, to 11.0 (6.0 prior), marking the highest since January. Revenues rose to 4 from 2 prior, with demand and capex also picking up, with expectations doing likewise across the board.
• The only real soft spot in services was in employment which remained flat, despite a pickup in wages.
• With little further detail or color available aside from the Richmond fed aside from the survey data results, the main conclusion to reach here is that services firms are faring better than manufacturing counterparts in the higher-tariff regime.