From Dave Lutz at JonesTrading, here’s a quick look at what traders are talking about this big global selloff:
Good Morning! US Futures under sharp pressure (but off lows), with NDX off 90bp and Russell 75bp as Semi numbers come in weak, Growth concerns mount, and Ebola fears in UK hit overnight. The Damage in Energy complex continues — WTI is off 1.5% (was off 2.5% earlier), and Brent remains under the weight of heavy put positioning at $US90. Resource stocks remain under sharp pressure in London and Aussie, as the Coal complex continues to reel from China’s surprise tariff announcement yesterday. The DAX is getting whacked for 2.2% in VERY heavy volume, as it takes out YTD lows — Consumer stocks are off nearly 3%. It wasn’t any prettier in Asia, as a Breakdown in Hong Kong talks saw the Hang Seng lose nearly 2%, and Shanghai finally retreats from an 8day winning streak. Aussie was hit for 2% as Miners were hit sharply — Only Taiwan closed green in Asia… We have 4 Fed speakers today, and they all represent the most “hawkish” opinions. After the EU close, we get ratings updates from S&P on Finland, France, EFSF sovereign rating – Fitch on Portugal – possibly Moody’s on Italy, Latvia and DBRS on Italy, Spain, the Netherlands.
Sovereigns have a bid again today, with the US 10YY off 2bp to 2.29% into the 3day weekend (US Credit closed Monday), and German Bunds yielding 88bp. Continue to expect growth stocks to remain under pressure, as Euro Inflation Swaps are hitting fresh lows this AM. The $US is making gains against Euro and Yen, the latter breaching Y108 support again. The stronger dollar is a headwind for commodities, and most everything is solidly in the red. Industrial metals like Copper and Silver are off near 1%, while even safe haven gold is retreating. The focus remains on the Energy complex, which sees Brent testing the 2012 lows, while WTI’s 2012 lows remain down $US10 from here. Only Natty is bid this morning — The AG complex is all solidly in the red into WASDE data later today. Today we get US Import prices at 8:30, Fed’s Plosser (hawk) Speaks on Monetary Policy at 9, there is NO POMO at 11 — at 12 we get WASDE data for Agriculture, at 1 we get Baker Hughes Rig Count and Fed’s George (hawk) Speaks on Economy, Fisher (hawk) speaks at 2:10, at 3 Fed’s Lacker (hawk) Speaks on Financial Firm Bankruptcy at 3:30 gets us “Commitment of Traders” data
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