Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about before the opening bell on Thursday:
Good Morning! SPX going for 4th green day in a row behind multiple tailwinds (Oil rebound, Dovish ECB/Fed headers, Financials bounce, China FX and Equities stable) — now we havetomorrow’s expiry “gamma” rebalancing to consider as we attempt to escape “correction territory”. Spoos are up 50bp, but coming off peaks as WMT #s come across. Over in Europe, The DAX is climbing 1.5% led by sharp pops in Industrials and Tech — Fins are lagging, but hanging green — but Europe’s food and beverage sector under pressure on Nestle #s — that said Airlines are flying on Air France #s. London is lagging as “Brexit” fears ramp and Miners retreating on the FTSE after a strong week — Anglo off 6% and Rio 4%. Glencore holding bulk of y’days sharp gains. Over in Asia, Late Day selloff pushes Shanghai slightly red, but despite the Yen stronger, Nikkei leapt 2.2% as a sharp rebound in Banks continued (Topix Fins up 12% this week) – Aussie leaps 2.2% – the biggest 1day gain since December as resource companies’ bounce over 5%. All of EM looked well bid overnight.
Global Sov Yields are under some slight pressure to start, as Japan’s 10YY touches 1bp overnight — but US 10YY continues to have footing above 1.8%. The DXY is breaking higher despite dovish comments overnight from hawk Bullard — as Euro breaks lower as early reports from the EU summit signal No agreement on David Cameron’s reform deal. EM currencies are weaker, as Indonesia Cuts Rates (expected), while the Yen stronger despite some disappointing trade data. We are seeing selling across te board in metals, with Gold, Copper and Silver down ~50bp — but eyes remain on the Energy complex, where WTI adding almost 3% as API shows a surprise draw last night of -3.3MM, Cushing -175K (Street was lookin for build 3.5M overall, 700k in Cushing). Natty Gas is getting hit for 1% ahead of inventory data later this AM.
Ahead of us today, we get ECB Minutes at 7:30, followed by Philadelphia Fed Business Outlook and US Weekly Jobless Claims at 8:30. 10am brings the US Leading Index, then we get Natty Gas Inventory data at 10:30, followed by DoE data for Crude at 11am. At 1pm, the US Treasury is auctioning $7B in 30Y TIPs, and 3:30 Fed’s Williams (non-voter) Gives Outlook Speech in L.A. Down in Washington, the FCC February Open Meeting brings a vote on Set-Top boxes. The House and Senate are not in session.
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