Dave Lutz, head of ETFs at JonesTrading, has an overview of today’s markets.
- US markets are in the red as a major portion of the Senate’s tax bill collapsed and voting was suspended.
- The US Dollar is slipping.
- WTI oil is up again on Friday after OPEC agreed to extend production cuts.
Morning! US Futures under pressure as the DC Circus ramps up – “U.S. Senate suspended voting on the tax bill until Friday as it emerged a key compromise to win a majority had collapsed” – Nasdaq off 70bp as selling continued in Asia, while that Russell is off 60bp as Fins falter. Wide sea of red in Europe, with the DAX and FTSE on 2month lows. Every sector red in Germany, led by 1%+ drops in Tech, Industrials and Consumer names, pressing the DAX off 90bp. Banks are among the downside leaders, while Energy Names outperforming. FTSE slightly better, but off 30bp as Defensive shares rally. In Asia, Nikkei added 40bp, but Hang Seng lost 30bp as Tencent was hit for 3.5%, bringing week’s losses to 7.5% – Shanghai unch, but smallcap driven Shenzhen up 80bp – KOSPI off small after decent whacks this week with Sammy losing 8%+, and Aussie up 30bp as Energy rallied
The Dollar was under decent pressure on the Washington Antics, but has staged a rally back towards unch. A sharp bid in Bunds is driving the US 10YY lower as Mitch McConnell said lawmakers would resume voting at11am. Sterling drifting around 2M highs as UK PMI prints better, but Euro breaking downside $US1.19 despite EU PMI printed a 17Y high. Gold up very small, a uninspiring move despite the DC headers and $, while Bitcoin is back over $US10,000 – Ore was up another 1.2% in China, and we have Copper up 40bp early. WTI is holding a 1% gain early as Economic data continues to print strong, while Natty is squeezing 3%