Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about this morning.
Good Morning! Global weakness continues, a combination of Saudi/Yemen — Greek Deadlines — Angst into earnings — all weighing in a light liquidity environment into Q end positioning. The S&P is off70bp and under the 50/100dmas — while Nasdaq is falling 1% as the IBB gets hit again thru yesterday’s lows. The DAX is off 1.5% led by another smackdown in technology, with the SX8E off another 2.5% in early trade. Financials, Consumer and Industrials all following south, where the Energy complex the only in the green with Oil popping overnight. Volumes are pacing heavy in Europe on this selloff, with the DAX trading 30% heavier than normal. Thanks to the growing regional conflict, Saudi’s market lost 5%, with Dubai just behind. Kuwait and Qatar saw more modest ~2%+ losses. Over in Asia, Shanghai managed a rally; Aussie hit despite a rally in the miners – Financials were the biggest drag on the ASX — while our International traders noting a Relatively calm broad based selloff as Japan heads into FY end as many institutions tend to lock in gains at start of new FY. Also, domestic pension fund div reinvestment today and tomorrow.
The US 10YY is off 2bp but remains above 1.9%, while the $US is losing ground against Euro and Yen early as the DXY got exhausted at the 97 level (for now). There is a nice bid in the commodity complex – Brent and WTI had both jumped 6%+ on headlines Saudi was attacking rebels in Yemen, but have since surrendered ½ those gains. Industrial metals like Copper are popping as we approach the weekend and doveas hope for China stimulus announcement, while Gold is back upside $US1200/oz. The Softs are slightly bid on the falling $US, while Natty meanders near unch into Inventory data. We get weekly Jobless claims at 8:30, at 9 Fed’s Lockhart Speaks on Economy, Monetary Policy, BoC Governor Stephen S. Poloz to Speak at 9:30 – Markit US Composite PMI at 9:45. Natty gas inventories at 10:30 and Kansas City Fed manufacturing activity at 11. We have a 7Y auction at 1pm today.