Via Dave Lutz, head of ETF trading at JonesTrading, here’s a quick guide to what traders are talking about on Wednesday:
Good Morning! US Futures are popping this Fed Day (Announcement at 2pm, No Presser) as Nasdaq jumps 70bp on Earnings (AAPL up over 6%) and the Spoos add 20bp. Over in Europe, it’s all green seas with the DAX adding 80bp as Autos and Luxury better — and Euro Fins gaining grounds despite a 5% drop in DB after disappointing #s, but Santander’s print is softening the blow. London’s FTSE hits fresh one-year high as every sector but Staples gain — but volumes across the continent remain weak, with most exchanged 10-25% light into the Fed today. Mixed picture in Asia, as Nikkei soars almost 2% as Abe announces a better than expected Japanese stimulus package despite the Stronger Yen hitting Nissan and Nintendo profits — while China suffers the worst hit in 6 weeks on regulatory concerns. Aussie added small, and EM closes higher, led by Taiwan and Indonesia hitting 1Y highs.
US 10YY is slightly higher despite a persistent bid in Bunds and JGB’s — but that “Policy Sensitive” 2YY has popped to 1M highs despite Fed Funds showing little chance that Janet surprises Markets today. The $ is higher — the Pound slides below $1.31 as UK retail sales fall at fastest pace since 2012 — Yen hit on Abe reports and chatter of a 50Y issuance, while the A$ was hit on weakest inflation since 1999. Metals are all under pressure despite Ore popping 1% in China, led by 50bp+ drops in Copper and Zinc. WTI remains lower and on 3M lows as API showed a smaller draw than expected, while Natty is off 50bp. Softs are all mixed.
Ahead of us today, we get US Durable Goods Orders at 8:30, then attention turns to Housing, with Pending Home Sales at 10. DoE data for Crude hits at 10:30 – API showed that U.S. crude stocks fell by 827,000 barrels, well short of the 2.3 million barrel draw that had been expected. At 2pm we get the “Main Event” with the FOMC Rate Decision (No Presser).