Via Dave Lutz at JonesTrading, here’s what traders are talking about before markets open on Tuesday.
Good Morning! US and European Futures have been on a see-saw this AM thanks to Greek Headlines — While there seems to have been a lot of movement in the last few hours in the direction of a new proposal, there is nothing concrete occurring yet before the bailout expires at midnight Euro time. While US Futures are up 50bp and trying to recover from yesterday’s sloppy close — the DAX remains in the red, losing 40bp under the weight of falling Technology shares. Peripheral markets in the green, with Spain and Italy shrugging off contagion concerns. Volumes remain elevated, with most Euro markets pacing 25% heavier than normal. Volatility reigned in Asia, as the Shanghai closed with a 5.5% gain, having at one point been as much as 5.1% lower. The Shenzhen index also reversed course to rise 4.8%, while the small-cap ChiNext board swung from a 8.1% drop in the morning session to finish 6.4% higher as the Chinese Government continues intervening to soothe fears of a stock market collapse. Japan’s Nikkei 225 rose 0.6%, while Hong Kong’s Hang Seng added 1.5% and Australia’s S&P/ASX 200 climbed 0.7%.
The US 10YY has reversed early gains to trade unchanged, and German Bunds remain in demand as optimism fades into the headlines. Haven flows drove the Euro towards 1.13 in the overnight, but it has since reversed to trade unchanged after the Dollar’s smackdown yesterday into Month/Quarter End today. With the DXY slightly higher (but firmly below that 50dma), we have a headwind for commodities. We find most Metals in the red, led by a 1% drop in Copper — While most of the Grains are well bid into the Acreage report later this morning. The Crude Complex is seeing a slight bid, but Iranian headlines the next 12 hours are square in the eyes of Traders. Scheduled Catalysts include ISM Milwaukee at 9 along with Case-Shiller — at 9:45 we get Chicago Purchasing Manager (9:42 for paying subs) ahead of Consumer Confidence at 10. USDA 2Q grain stocks, U.S. 2015 acreage planted report hits at Noon. At 12:05, Obama holds a presser with Brazil’s Rousseff. At 2pm the EIA releases petroleum supply data — and after the bell we get API data along with a speech from Fed’s Bullard.