Via Dave Lutz at JonesTrading, here’s a quick guide to what traders are talking about right now:
Good Morning! US Futures remain risk-on, following Fed Chair Yellen’s very dovish speech yesterday. S&P Futures are currently up 60bp, but the FANG basket and AAPL have Nasdaq up 75bp. This mirrors broad strength across Europe, where the DAX has climbed nearly 2% as Discretionary rips higher on Metro headers. The FTSE is up 1.7% as Miners are ripping higher in London, with Anglo up 10%+ at one point. While Volumes are better across the continent, they still remain slightly under the 20day average. In Asia, Shanghai jumped 2.2% amid local speculation about a state-owned player buying, Aussie gained small as the Big Banks saw selling again — while the Nikkei lost 1.3% as Yen strengthened and industrial production saw its largest collapse since March 2011. EM is ripping as the $ drops, causing the EEM to surge thru 200dma, a first since last June.
Some Eurozone government bond yields have dropped to fresh record lows with the German 10YY approaching 12bp before reversing — all thanks to Fed dovishness and the acceleration of ECB buying coming this Friday. The US 10YY is up small, recovering from 1month lows overnight, while that “Policy Sensitive” 2YY continues to fade lower. The DXY continues to see weakness, losing ground against Euro, Yen and Commodity Currencies — continuing the tailwind for commodities. The Metals complex is mixed however, with Gold seeing some profit taking and Copper under pressure, but a Smaller API build than expected (2.6M vs 3.2+) is lifting Crude complex ahead of DoE data later today.
Jobs Week data kicks off in earnest with ADP Employment Change at 8:30 this AM and the Online Help Wanted Index at 10. We get that DoE data for crude at 10:30, and at 1pm the US Treasury is auctioning off $28B in 7-Year Notes — right when Fed’s Evans Speaks on the Economy and Policy (He is the biggest dove on the FOMC, but a non-voter this year). At 3pm we get Agricultural Prices. Down in Washington, at 8:45 U.S. Treasury Sec Lew delivers address on sanctions — The NYT says Lew to warn against excessive use of sanctions.
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