From Dave Lutz at Stifel, Nicolaus, here’s the ultra-condensed look at what people are talking about this morning.
Good Morning! US Futures are higher this AM, with the SPX adding 45bp as DC’s closure seems to accelerate hopes that a Debt Ceiling deal will get done — Many think the negative press today increases the odds of a Debt Ceiling deal as the “heat is on” — Overseas markets are upbeat as well, with the DAX adding 70bp as the EU fins tack on over 1% – Risk remains though for equity bulls in Europe, as Italy’s yields are blowing wider again today, but still below yesterday’s stress wides. In Asia, Nikkei surged on a stronger Tankan, but profit taking hit as Abe announced his Corporate Tax Plans – EM is rallying as we got bullish data from Turkey, Indonesia and India — The Sensex added 70bp, and Thailand leapt almost 2%. China remains closed for Holiday.
For the last 2 years, the first of the month has brought a huge ETF rebalance — typically Selling IWM, UWM, IVV, SSO and buying UST, IEI. Since May, the S&P has rallied on the first session of the month — We get Auto Sales figures throughout the session today, and US PMI at 9am, and Manufacturing data at 10. There is some chatter in the marketplace of a early release of Friday’s Jobs report (as soon as today) — but more articles saying it will be delayed. US Treasuries are weaker, despite the stress coming from the PIIGs debt — and the DXY was whacked sharply after midnight’s shutdown deadline, providing a tailwind for commodities — We see WTI rallying slightly from 3M lows — while Industrial commodities like Copper and Brent remains under pressure on concerns Washington antics will spark a broader economic slowdown — Gold has a slight bid to it as India’s imports jump back, but Silver underperforms on the Industrial concerns.