Dave Lutz of Stifel, Nicolaus has the top topics about which traders are chatting today:
Good Morning, and welcome to Tax Day! The S&P 500’s 2nd worst session in 2013 was on “Tax Day” – We lost 2.3%. It is “Turnaround Tuesday” however, and important to note we have rallied 12 of the last 14 Tuesdays, for an average gain of 60bp. We also have VIX expiration today, so keep an eye on the contract structure as players roll from April to May contracts. US Futures are starting today slightly higher, resting near highs of yesterday’s session. EU markets are rallying from Germany’s ZEW print, which knocked the DAX down 1%. Focus remains on Ukraine, where their FX is bouncing sharply on the Interest Rate spike — but Stress remains in Russian Equities and Debt — with the Micex off 1.5%, and chatter about Russian Corporates “locked out” of global capital markets. In Asia, China was hit for 1.5%, led by bank shares on weak loan growth data, and a big PBoC repurchase operation. The Nikkei gained 60bp, ending a 7day losing streak, but futures are marked lower right now. Aussie fins rallied on Citi tailwinds and upbeat minutes from the Aussie Central Bank.
The 10YY is slightly higher this AM, taking out yesterday’s peaks ahead of 5 Fed Speakers today – Yellen at 8:45amET along w/Lockhart at 8:30amET, Plosser at 3pmET, Rosengren at 4pmET, and Kocherlakota at 8pmET. The $US is flat to Yen, but rallying against the €, causing a headwind for commodities. We have heavy pressure in precious metals, led by a 1.6% drop in Gold on headwinds caused from a WGC report on Chinese demand. The Energy complex is red — with WTI retreating from a 5week high as a Russian Embargo seems unlikely. Keep an eye on Earnings — as we have JNJ, KO pre-market, and INTC, YHOO after the close — Several of those names have been recipients of “covering” from Hedge Fund Deleveraging. Aside from aforementioned, other Scheduled Catalysts include Empire Manufacturing and CPI at 8:30, Net Long-term TIC Flows from the Treasury at 9, NAHB Housing Market Index at 10 — the week’s largest POMO at 11, and API data for Crude at 4:30.