Dave Lutz, the head of exchange-traded funds at JonesTrading, has a quick overview of what’s going on in markets on Thursday.
- US stock futures are mixed, while the FTSE 100 in London is headed for its worst week since November after hitting 14 successive all-time highs.
- Netflix is up 8% after topping estimates for subscriber growth.
- The European Central Bank left its base interest rate at 0% and its deposit rate at -0.4%. In US economic data, initial jobless claims and housing starts will be released at 8:30 a.m. ET.
Morning! US Futures pretty Mixed to start this Thursday. NFLX up 8% – Bodes well for FANG and Big Tech / CSX up 12% on Harrison Headers and M&A / KMI off 2% on Numbers. Overseas, Europe VERY quiet into the Draghi and ECB call at 7:45 (8:30 presser) — Focus on Inflation commentary and changing mix of Asset purchases. Fins are rallying across the continent, while Tech and Energy are seeing pullbacks. FTSE 100 is now headed for its worst week since early November after hitting all-time highs 14days in a row. Sterling holding near recent peaks — Volumes actually pacing a touch heavy, but feels all futures driven with little single-stock action. In Asia, Falling yen helped Nikkei climb 90bp despite Toshiba smashed for 16% on writedowns – Hong Kong lost 20bp, while China was 40bp weaker – Malaysia and Indonesia holds rates unch. EM Asia all closed slightly higher.
Treasury Yields 10bp higher in last 2days as Yellen warns rates delay risks ‘nasty’ surprise and China dumps its holdings. The US 10YY is back over 2.43% while Bund yields licked 40bp earlier before retreating. The Dollar is stronger as Yen and Sterling break a bit lower, but Euro moving to session peaks into Draghi. Ore was hit small in China, and we have weakness in all industrial metals, led by a 1.3% drop in nickel. Gold off 80bp, but holding multiple tests of $1200. WTI up small despite a massive API draw as Gasoline is barely changed on a heavy inventory build, while Natty drifts around unchanged.
Ahead of us today, we get the ECB Rate Decision at 7:45, followed by the Draghi presser at 8:30 — right when Philadelphia Fed Business Outlook hits, along with Housing Starts and Permits for December. Energy in focus mid-day, with Natty Gas Inventory data at 10:30 followed by DOE data for Crude at 11. At 1pm, the US Treasury will sell $13B in 10-Year TIPS Reopening. After the close we get earnings from AXP / IBM, SWKS / JBHT, UAL — and Fed’s Yellen speaks at Stanford tonight – “The economic outlook and the conduct of monetary policy”.