Dave Lutz, head of exchange-traded funds at JonesTrading, has a quick overview of what traders are watching on Thursday. In brief:
- US stock futures are pointing to a lower open. After Wednesday’s closing bell, Kohl’s and Macy’s cut their estimates for profits this year, citing weak holiday sales. That could weigh on retail-sector stocks during the trading session.
- It’s almost jobs Friday. But before that, ADP releases its private payrolls report, which is expected to show an increase by 175,000.
- The dollar is lower while bitcoin is getting smashed after a big rally after China’s yuan surged.
Good Morning, and we kickoff Jobs Data w/ ADP – Expectations are for a 175,000 gain — roughly in line with payrolls forecasts Friday – Overall US Futures are slightly lower, as KSS and M will have retailers reeling today in the States – Mixed Bag in Europe, as the STOXX gravitates around unch and DAX up small. Miners acting well, Fins doing OK, but Industrials, Materials and Discretionary all lagging. FTSE just off a fresh record as UK PMI hits fresh recent peaks, London torn between a rally in Miners and HC, while Fins are under pressure. In Asia, Stronger PMIs from China and Hong Kong helped Hang Seng jump 1.4% – Aussie closed up 30bp as telcos and energy rallied, while the Nikkei lost 40bp as it consolidated yesterday’s 2.5% gain. EM Asia all had a bid again overnight as the Greenback retreated.
Heavy focus overseas on a BILD op-ed which says it is time for ECB to raise rates, causing Stop-Losses in Schatz which drove Bund Yields higher. Treasuries are relatively quiet as we await Payrolls — while the DXY continues to retreat from Tuesday’s 14Y high. No bounce from the worst whack in 2 months yesterday. Focus on the China Yuan having the biggest 2day rise on record while CNH Hibor rips to 1Y highs as PBOC soaks up liquidity, while Headers have the Lira getting smashed to fresh record lows. Industrial commodities all better, as Better Chinese PMI and News that Beijing plans a $115bn railway infrastructure project is helping boost sentiment towards construction-linked commodities — while the Weaker $ is helping Gold hold the Fed Minutes Bid. Oil up 1% on Saudi Headers and a massive draw in Inventories reported by API last night. Natty showing a bounce after being trounced by 12.5% so far this week.
Ahead of us today, we get Challenger Job Cuts at 7:30, ahead of the ADP Employment Change at 8:15 and Weekly Jobless Claims at 8:30. Markit US Services PMI posts at 9:45, just before the “Official” ISM Services read at 10. Attention then turns towards Energy, as the EIA presents findings of Annual Energy Outlook 2017 at 10am, Natty Gas Inventory data posts at 10:30, and DOE data for Crude hits at 11. Headers from CES in Vegas continue to roll.