Via Dave Lutz at JonesTrading, here’s a quick look at what traders are chatting about before the market open:
Good Morning! US Futures remain under pressure early, with Russell once again underperforming and losing 40bp, while Nasdaq is only off small as AAPL surges to a new all-time high in the pre-market. Focus in US trading will remain on the Biotech sector, which was hit sharply yesterday — the IBB barely closed above it’s 50dma (and 5% drawdown level) — strong support areas in the past – EU Markets are all reversing gains from yesterday, despite more conciliatory tones coming from Athens and Greek Yields remaining under pressure, as the Euro gains upward momentum, reversing the “Sell US, Buy EU” trade of late. Fins are your biggest weight in Europe once again, losing over 2% in German Trade despite Greek tailwinds, while Consumer Discretionary continues to try to outperform. Of note, DAX turnover is heavy today, with most issues trading at least 1.4x their recent volumes. Over in Asia, China lost 1% as merger speculation cooled and earnings took hold — Japan added 40bp ahead of their closure tomorrow, while Another strong overnight for Ore, adding over 2% – but miners were hit with sharp profit-taking in Aussie.
The US 10YY is basically unchanged around 1.92% as the street awaits the FOMC, while German Bunds have a slight bid, pressing yields back under 15bp. As the 2day FOMC meeting begins, much focus this week remains on the inflation “breakevens”, which have been surging forward of late as Oil rallies. The Dollar is losing further ground against Euro as shorts are covered in the common currency, while that Aussie $US continues to ramp higher (commodity tailwind). With the DXY under yesterday’s lows and the 50dma, we have a nice tailwind for commodities, but not much enthusiasm, with Gold/Silver consolidating yesterday’s gains, and the Oil complex off slightly. While focus is on the Micro (40 S&P 500 companies report today, 226 companies report in total) — other Scheduled catalysts include Case-Shiller at 9am, Consumer Confidence and Richmond Fed hits at 10am, U.S. Housing Vacancies at 11, and we get a Obama / Abe presser at Noon before the $US35B 5Y auction at 1. ECB’s Weidmann Gives Speech in Essen, Germany at 1:30, and the day wraps with API inventories at 4:30
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