Dave Lutz of JonesTrading has the hot topics traders are talking about today:
We had a nice bounce in Equity futures a bit ago, as commentary from Putin that he will do his utmost to stop bloodshed in Ukraine + comments from the Finnish PM saying the EU is not considering further sanctions against Russia caused Germany to jump 1% from lows. Global Volumes remain quite disappointing, despite options expiry in some markets. Russia’s MICEX is retreating from overnight highs, but the German market remains well bid. In Asia, Nikkei added 70bp on dovish hopes, while South Korea lost small as the BoK rate cut was well anticipated by markets. India and Aussie both had a good overnight, as Materials and Consumer stocks fared well. We need to keep an eye on our Options Expiry in the USA tomorrow — Heavy chatter that we could get “Pinned” at 1950, while it feels the Options dealers are all short Gamma — could provide support in a selloff, or a squeeze if we break sharply upside 1950 (I’m working on getting Gamma positioning this AM)
In Credit – Germany got a quick taste of their 10YY below 1% before it snapped back as Euro-Zone GDP was horrific, with even Germany contracting. US Credit is basically unchanged into the 30Y auction today, and overnight REPO rates have dropped back toward 3M lows — easing liquidity calls for margined positions. The DXY is retreating from 10M highs, giving commodities a slight tailwind, but the bulk of the complex is in the red. Gold is off small despite India inflation dropping and terrible consumption data out of Asia, while the Brent complex remains under pressure, losing 60bp. We continue to watch the oversold conditions in AG — specifically Wheat as it’s been hit for 6% and is quite oversold with a crowded short base. Scheduled catalysts today include weekly claims at 8:30, the week’s biggest POMO at 11, and a 30Y auction at 1. 13F filings are due to be submitted by today..
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