Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about right now:
Good Morning! Spoos adding to their best rally since March as hedges continue to unwind — The SPX is up 60bp, but these smallcaps are jumping nearly 1% early. Across the Atlantic it’s a sea of green, as the DAX jumps 1.2%, and the FTSE jumps 2.1% and nears “pre-Brexit” levels as their VIX collapses. Energy shares are loving Oil prices, while banks across the continent jump 3%, while Turkish equities trade lower on the triple-suicide attack in Istanbul. Turnover remains heavy, with no major sectors in Frankfurt or London trading lower. In Asia, Shanghai gained 70bp – Nikkei up 1.6%, shrugging off the Yen as Fins and Tech rallied – Aussie climbed 80bp on the back of materials and energy, while we saw a strong overnight for Emerging Markets, where shares in South Korea, Taiwan, Indonesia and the Philippines led gains, rising at least 1%.
Still a strong demand for Yield, as the Irish 10-year yield falls to a new record low while German Bund Yields nosediving a bit here. Their 10YY at -13bp right now as EU leaders continue to debate the implications of Brexit at a summit in Brussels and Fed’s Powell was all dovish last night — Fed Funds now pricing in next hike for January 2018. The British pound continued to rise for a second straight trading session, while the PBoC intervened in the offshore yuan market this morning to stabilise their FX. The DXY is near yesterday’s lows, and commodities are loving the tailwind: Silver is leaping 2.3%, while Copper is basically unchanged around 2month highs. WTI is climbing 1% on the back of a Huge API drawdown and a potential strike in Norway — while Natty continues to add to yesterday’s 7% squeeze.
At 8:30 today, we get Personal Income and Spending, along with core PCE. At 9:30 ECB’s Draghi Participates in Panel at ECB Conference, and at 10am we get US Pending Home Sales for May. At 10:30 attention turns to the DOE data for Crude, where last night’s API data showed a draw of nearly 4mm, with 1.2mm coming out of Cushing. All eyes on the Fins today ahead of 4:30pm, when the Federal Reserve Board releases CCAR results. Down in Washington, there is a Senate Homeland Security Cmte meeting on “Preparing for and Protecting the Nation from Zika” at 10 a.m.
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