Via Dave Lutz at JonesTrading, here’s what traders are talking about before Monday’s market open.
Good Morning! US and Euro markets are jumping on M&A (in multiple sectors) + Greek Optimism as the summit convenes and ECB’s governing council raised the ceiling on Emergency Liquidity Assistance to Greek Banks again this AM, allowing them to stay open. Germany is flying, with the DAX up almost 3% led by Consumer Discretionary — but Fins, Tech, HC, Industrials and Materials are all up 2.5%+ in heavy volume. Athens is up 6.5% as most Greek banks jump double digits. Our Asia traders in Hawaii tell me that Japan was stronger as chatter GPIF selling JGBs and buying Topix core 30 – TSE Mothers closes above 1k for the 1st time in 1.5 years — Hong Kong recovered from early losses on Europe – Taiwan Taiex outperformed, up 1.4%, while Chinese markets are closed today for a public holiday.
There is a sharp bid for PIIGS debt where the Greek 10YY are now down 1.5% on the session (easily the biggest move I’ve seen in some time), reversing all of last week’s losses. Spain and Italy are in 20bp, while all the purchases being funded from selling German Paper. 10Y Bund Yields are up 10bp, dragging US Yields higher, with the US 10YY taking out Friday’s 2.32% peak in early trading. The DXY is slightly higher, as Euro gains slightly, but the Yen and A$ are breaking lower. Gold hates today’s action, with multiple attempts to break $US1200 rejected. The Oil complex is slightly higher after Friday’s weakness, but Natty Gas is getting hit for 3%. Most of the Softs are higher. Scheduled catalysts today include Chicago Fed at 8:30 — Euro Consumer Confidence at 10, along with US Existing Home Sales. At any point we could get the Supreme Court’s ruling on ACA (Due by the end of June) – Court to issue orders at 9:30am, opinions at 10am.
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