Dave Lutz, head of ETFs at JonesTrading, has an overview of today’s markets.
- US stock futures are under pressure this morning.
- US 10-year is down to July lows thanks to struggling German bonds.
- Euro jumped to 2-year highs, ignoring ECB President Draghi’s speech urging the opposite.
- Oil is down as OPEC reports higher supplies.
Morning — Happy Expiry Friday! US Futures starting on the back foot, off small despite MSFTand GE trading higher after numbers. It is a wide sea of red across Europe, with German Exporters not a fan of the Euro Rip — hitting the DAX for 70bp, and right thru 100d support. Discretionary wasn’t happy with Hermes numbers, while Autos are under pressure. Energy had been higher, but has lost gains as Oil has dropped. In London, FTSE down small as Healthcare and Staples gain — while Swatch numbers are helping the Swissies outperform. As we’d expect for Expiration, all exchanges trading heavier volume. In Asia, TOPIX off 20bp – Hang Seng lost 10bp — China dropped 50bp, and Aussie lost 70bp as BHP was hit on Elliott headlines
The German 10YY has broken downside of 50bp, dragging the US 10YY to July Lows. The DXY remains weak as Euro laughs off Draghi’s attempt to be dovish — with the common currency hitting 2Y highs. The $/Y breaking downside 50,100, 200dmas, while the Aussie$ got smoked on Central Bank headers — but the FX in focus is the Polish Zlotny, getting hit on a judicial reform bill. In China, Rebar initially hit for 5% before recovering, while Ore closed up 1% – this has Copper touching 4month highs. The Oil complex just dove red on reports of a ramp in OPEC supplies. Natty is firmly red, despite the heavy heat most of America feels outside.
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