Via Dave Lutz at JonesTrading, here’s a brief guide to what traders are talking about before the market open on Friday:
Good Morning! US Futures are up 30bp and in rally mode despite headlines gunmen holding 170 hostages at the Radisson Blu in Mali. Both the DAX and SPX continue trading over the 200dma, with Germany up 35bp as Consumer discretionary shares and Semis get a lift, but Banking shares are seeing some profit-taking in average volume despite ABN Amro rallying in Amsterdam trading. The FTSE is lagging a bit, as Energy shares weight heavy there, but the Miners are popping, helping the FTSE to trade unchanged. Over in Asia, Shanghai gained 40bp after Beijing took steps to boost liquidity in the banking system, while the Nikkei gained small in light volume into a 3day weekend for Japanese investors. Aussie gains small to cap off their 2nd best week of 2015 on the back of the Financials, while all of the Emerging Markets closed green as most of the Asian currencies enjoyed a strong overnight against the Greenback.
The US 10YY is unchanged, but Hawkish winds blow with the “Policy Sensitive” 2YY breaking above 90bp and toward multi-year highs — while Fed Funds rest at a week high 68% chance of liftoff in a few weeks. The $US gaining against the basket, with the Euro testing yesterday’s lows after Draghi stressed he was willing to take further easing measures — driving Germany’s 2YY to fresh all-time lows. The Yen continues to have some upward momentum, with the $US/Y cross failing to break upside 123 in several attempts overnight. With the stronger $US, we should have a headwind for commodities — but we have had a nice jump overnight from oversold conditions in some of the industrial metals, led by Zinc gaining 4% as Chinese smelters reduce output — and Platinum and Copper rising ~1% in early trade. The Crude complex is looking sloppy, however — with WTI taking out yesterday’s lows under $US40 into Expiry today as GS argues for $US20 Crude — and Natty Gas falling 2.5% on massive stockpiles and milder weather.
Ahead of us today, we get Fed’s Bullard speaking on the Economy at 9am, US Consumer Confidence at 10, Kansas City Fed Manf. Activity at 11, just before Fed’s Williams Speaks on Monetary Policy at Noon. At 1pm we get the Baker Hughes Rig Count, while ECB’s Coeure Speaks in Berkeley at 2:30. #:30 brings us that CFTC “Commitment of Traders” data. Down in Washington, the Senate and House are not in session, but at 1:45 Mark Mazur, U.S. Treasury assistant secretary for tax policy, speaks on panel discussion at National Tax Assn’s annual conference in Boston — perhaps providing some additional insight into Lew’s announcement this week against Inversions.
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