We’re bracing for a blizzard here in New York City. From Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about this morning:
Good morning! US Futures are off small as they eyeball Syriza’s resounding victory over the weekend. Euro hit initially as far-left anti-austerity Syriza party moved to form a government after its overwhelming win at the polls, but the common currency is bouncing back. Athens was off 5% but has rallied, despite the Greek banks getting hammered. Markets are handing Greece in stride, thinking either a compromise will keep Greece in the EU, or a orderly departure of Greece from EU actually makes the Euro stronger. Good read from the BBC — “Why aren’t markets panicking about Greece?”
Attention is also on Winter Storm Juno — New York +20 inches and Boston +25 inches. NY Post reporting NYC possible + 3 Feet. The Storm is arriving early, and Snow may fall so hard and fast that commuter rail, buses and subways could shut down before workers leave for home on Monday afternoon, New York Governor Andrew Cuomo said. Be safe out there. The DAX is up 80bp, led by a solid rally in Consumer names again, while concerns over Greece continue to weigh on EU banks. It was a Rough weekend in Ukraine, and while the Ruble was stable, the MICEX is giving back 2%. The Nikkei was off small, China closed at a 5Y high, and Markets in Australia and India were closed for Australia Day and Republic Day.
Little stress evident in Sovereign bond markets — as US10YY is flat and German Yields are higher, but those German 10’s hit 33bp overnight before selling off. Greek Yields are out 50bp, but still tighter over the last week, and other PIIGS yields are flat to Bunds, showing little contagion risk at the moment. While the € is bid, the $US is making nice gains against the Yen as haven trades are reversed, hitting Gold for 1%. The Energy complex remains under pressure, with Oil off 1% as there has been no change in Saudi Policy, and Natty off 5% into Expiry this week. Aside from Dallas Fed at 10am, Focus will be on DHI’s number (Stock up 2%), OCN Settlement (up 45%), and MSFT/TXN earnings tonight. Aside from earnings, later this week we have a FOMC Rate Decision (No Presser); BOJ Minutes and Japan’s Jobless Rate, CPI, Industrial Production – EU Unemployment and CPI — CaseShiller, New and Pending Home Sales – 5 Biotech IPOs scheduled to price on Thursday, and Shake Shack comes Friday.