Via Dave Lutz at JonesTrading, here’s a super quick guide to what traders are talking about before markets open on Friday:
Good Morning! S&P Futures are retreating 20bp from yesterday’s expiry-induced surge as GE’s numbers spark some early selling (but “The General” is roughly flat) — but we will need to see what happens after Index options expire on the open of trading in the USA. European markets are mostly in the green, with the sole exception being the Stockholm exchange as industrials weaken on the back of SKF. Germany’s DAX is up 26bp and Stoxx 50bp as Financials enjoy the tailwinds blowing from yesterday’s strong moves in America. Luxury Stocks in Europe getting battered again, this time led by Hugo Boss disappointing, while the Food and beverage Sector under pressure from Nestle. The FTSE is having a strong session, led by Glencore up 3% on debt reduction plans. Over in Asia, Shanghai gained 1.6%, taking the week’s gain to 6.5% ahead of China’s third-quarter growth figures due Monday. Japan shares jumped 1% to 1month highs led by real estate, finance and insurers — The KOSPI weakened small as Tech came under profit-taking, while Aussie’s doves had the ASX up 70bp. EM Asia was a sea of green on the back of Singapore data, save Thailand which lost 50bp.
The US 10YY is under pressure, struggling to hold the 2% level as German Bunds come well bid. The Greenback is making gains across the board, as Nowotny’s comments yesterday still weigh on the Euro — The $US/Yen attempts to hold 119 — The A$ weakens as “rate-cut fever” kicks in down under. The overnight gain for the greenback has caused some emerging market currencies to weaken — but no major moves. With the Stronger $US, we have a headwind for commodities, and the Metal complex is under pressure across the board, led by a 1% drop in copper as it retreats from 1M highs, and Gold losing 60bp as it flirts with 16week peaks. The Energy complex is seeing a pop into the Baker Hughes data, led by a 1% pop in Oil as Saudi oil minister Al-Naimi sees oil demand improving (but a rather tepid upside move given recent weakness). The Softs are all weaker as they remain some of the best performing commodities over the last week.
Today brings Expiry (Index options expire on the open. Stock and ETF options on the close) — Scheduled Catalysts include Industrial Production at 9:15, JOLTS Job Openings and U. of Mich. Sentiment at 10am, and all Energy cats will be on the Baker Hughes Rig Count at 1pmet ahead of the CFTC “Commitment of Traders” data at 3:30. Treasury releases Net Long-term TIC Flows at 4pm. Down in Washington, at 9:30 SEC Chair Mary Jo White will give keynote address at Managed Funds Association – The White House hosts South Korean president for bilateral talks at 11:55, with a presser to follow at 1:40. The Senate and House are not in session…