Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about right now:
Good Morning! US Futures are starting under pressure, with the S&P off 40bp early, but well outperforming some carnage overseas. Chinese growth concerns and UK “leave” vote getting more momentum seems to be the focus — hitting the DAX for 1.3% in heavy volume. Banks are getting whacked, losing 2% across the continent and 4% in Italy — there are no sectors trading positive at the moment. In London, the FTSE is outperforming a bit, losing only 75bp as Energy and Materials outperform the broader market. Was ugly overnight in Asia, Shanghai lost 3.2% and Nikkei lost 3.5% as Fixed Asset investment in China plunged, IMF warned on Chinese corporate debt, and Fitch cut its outlook on Japan. Australia closed for a holiday, and even the falling $ could not help emerging markets, with all major players closing lower in decent turnover.
Havens are on fire — German 10YY tests 1bp overnight, driving 10Y treasury yields to 1.61%. Gold popping to 4week highs. All majors are gaining against the British Pound as volatility hits an all-time high ahead of the referendum next week. The Yen is surging in “risk-off” fashion, driving the $/Y cross to test 2016 lows. Commodities are starting today mixed, with a bid early in metals — Gold up 1% and Copper 50bp — and all the “softs” starting today higher led by a 2% pop in Corn. Energy starting mixed, with Natty jumping another 2%+, while Oil breaks downside $50 as Rigs Count increases for the 2nd week in a row.
Relatively quiet day of catalysts ahead of a busy week — A fresh ICM Brexit poll will hit at 7:30am — then we have 2 ECB speakers this AM (Nouy at 9, Carlos da Silva Costa at 10:40) — and at 11:30 the US Treasury Auctions $31B in 3M and $26B in 6M bills. At 1pm we start getting headlines from AAPL’s WWDC, ahead of Brazil’s Trade Balance at 2. Main catalysts rest of week include MSCI’s Chinese decision tomorrow, Fed Weds, BOJ and BOE Thursday and we have a Triple Witch Expiry Friday.
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