Dave Lutz, head of ETFs at JonesTrading, has an overview of today’s markets.
- Global markets are mixed.
- Analysts are predicting a 60% chance the Fed raises rates in December.
- Oil is at a 7-month high.
Morning! US futures are basically unch as Russell hangs near Friday’s all-time highs. It’s a mixed bag in Europe, but most markets rallying from lows — DAX is up 30bp – Banks the biggest downside weight, while healthcare, energy and industrials help mitigate losses. Eyes on the IBEX getting hit thru 200d for almost 1% as Catalan angst ramps. FTSE trading unchanged, with weakness in Banks and Miners being offset by a rally in Consumer. London is trading 30% light to trend, while DAX is a touch heavier. Tech and Smallcaps smoked in Asia – TOPIX added 50bp, but Hang Seng smoked for 1.4% as Chinese Property stocks get slammed while Shanghai down 30bp. KOSPI lost 30bp, but KOSDAQ lost 1% – Nifty hit for 50bp, while smallcaps smoked for 3.5% before a small rebound, while Aussie gained small as Banks retreated
With 13 Fed Speakers this week, including Yellen and Fischer — Fed Funds are resting at a 60% chance of a December Hike. The Dollar is rising on heavy Political uncertainty abroad – Snap elections in Japan have the Yen down – Merkel’s weaker showing weighs on Euro, as well as PIIGS debt – Political angst weighs on Kiwi$, while Sterling weaker as Moody’s downgrades UK. Europe angst has Bunds seeing a bid, weighing on US Treasury Yields as the 10YY rests on the 100d. Ore saw small bounce after last week’s 8% hit, while Nickel, Platinum and Gold all see a slight pop. Oil making fresh 7month highs early, as WTI nears a $US51 test. Softs are seeing weakness across the board.
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