Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about before the jobs report:
Good Morning, and aloha Jobs Friday (Street at +200,000) — Right now the S&P futures are recovering from some of yesterday’s selling, gaining 30bp in tentative trade ahead of the Jobs release. Euro markets, however, are not recovering from their worst smack since August — The DAX is off 60bp with every major sector in the red, led by a 1.5%+ drop in Telecom and HC shares. EuroSTOXX is off 50bp+, as some outperformance in Financials and Energy help, but the Tech sector is getting hit for 1%+. In London, the FTSE is nearing unchanged, as a slight rebound occurs in the mining sector despite iron ore slipping to new 10-year low. Asian Equities followed the West lower — Nikkei lost 2.2%, China 1.67% and Aussie 1.5%. I don’t see any major European, EM or Asian market in the green this AM.
The 10YY is basically unchanged as we await 8:30 headlines, and Fed Funds remain at a 74% chance of liftoff, unchanged from pre-Draghi headers. European debt continues to get hit, however — with Periphery debt still leaking a bit wider despite heavy selling in Bunds, with Germany’s 10YY up 26bp since the decision. The massive short-covering in Euros is abating a bit, helping the dollar bounce off four-week lows. Despite the $ pop, most commodities are in the green — led by a 3% jump in Lumber and a rally in Nickel, Copper and Platinum as the Chinese premier comments on reigning in industrial overcapacity. All eyes are on Vienna, however, as we await the OPEC 10am ET Presser. WTI and Brent are both gaining 1% ahead of that decision.
Ahead of us today, the “Main Event” is at 8:30, when we get the US Employment Report and Trade Balance. OPEC headers will start leaking out just after, into the 10amET presser – Euro Markets will remain on edge into the 11:45 Draghi speech in NY, where perhaps he may soothe the frayed nerves of the doves. At 1pm we get that Baker Hughes Rig Count, just ahead of the CFTC “Commitment of Traders” data at 3:30. At 3:45, just before the US equity close, we get Fed’s Bullard speaking on ‘The New Normal’ in Philadelphia, followed by outgoing Fed president Kocherlakota speaking at 4pm. Down in Washington, a pretty quiet day as the Senate and House are not in session.
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