Via Dave Lutz at JonesTrading, here’s a super-quick guide to what traders are talking about right now:
Good Morning! US Futures remain in retreat, losing 25bp as European stocks plunge to three-month low on ramping Brexit angst with UK’s biggest paper coming out in favour of “leave” and polls showing more momentum against staying. The DAX is off 90bp with every sector in the red — but the epicentre of weakness remains in the Financials as banks get hit, and Energy as Oil retreats from $50. The FTSE is off 1.3% as London’s losses are led by energy and financial stocks. Volumes across the continent are heavy, with most markets trading nearly 50% heavier than normal trends. In Asia, China stocks bounced small ahead of MSCI decision, Nikkei lost 1%, adding to its worst loss since February, and Aussie got whacked for 2% as they returned from Holiday. Some Emerging Markets in Asia managed a small bounce on the weaker $ yesterday.
US 10Y Treasuries broke downside 1.6% as Germany’s 10YY dives negative and 10Y Gilts and JGBs hit a record low overnight. The DXY is seeing haven flows, with the British Pound getting whacked on Sun Newspaper’s “Leave” endorsement and YouGov polls showing a huge ramp towards the exit. The dive for safety lifted the Swiss franc to a three-month high, and reversing “Carry Trade” bets have the $/Y nearing May’s multi-year low. The Flush to $ is hitting Gold, while every metal is firmly in the red. The Oil complex is off 1.3% Despite IEA saying Oil markers are “moving close to balance” as the greenback weighs, while Natty remains near unchanged, confounding the shorts. Every one of the Softs is reversing yesterday’s strength early.
Ahead of us today, we get US Advance Retail Sales for May at 8:30, ahead of the Business Inventories data at 10. At 12 ECB Board Member Mersch Speaks, then we go quiet into the API data for Crude at 4:30 tonight. The MSCI China decision is expected sometime after the market closes. “Brexit” watchers will be waiting for the release of the latest Ipsos-Mori poll at some point in the next day.