Via Dave Lutz of JonesTrading, here’s a quick guide to what traders are talking about ahead of the market open:
Good Morning! US futures are rebounding this AM, led by a 40bp pop in Russell names (IWM Ex-Divvy today). The action this week has been odd, as it feels a large global macro taking down Small exposure, but not risk — Russell Growth actually outperformed Value yesterday. Couple that with the $US15B in S&P futures that traded into the close yesterday (decoupled futures to cash by 45bp, a 4sd event according to MS) — we can see why illiquid equities are being manipulated heavily. Rosh Hashanah kicks off tonight (Thurs and Fri should be relatively slow as a result). Overseas, the FTSE remained under pressure in very light volume (heavy IPOs), while the DAX traded flat despite the weaker IFO sentiment survey. Over in Asia, Japan lost 20bp after re-opening from Holiday as the Yen pops (Abe voiced concern about recent weakness) — while China had biggest pop in 2months, led by brokerages. Aussie was under sharp pressure, led by Fins and Discretionary as their central bank warned on speculative demand in the housing market.
Demand sliding a bit in Treasuries, with the 10YY up small, and those 1M bills popping out of negative territory. Germany’s 10YY continues to battle around the 1% level, but I am focused on Greece — Yields out 50bp in the last week. The Yen is off the best levels of the session, and A$ popping near unchanged despite dovish comments in Aussie. Overall, the DXY is up small and near session highs, a headwind for commodities. Copper is gaining very small, but Silver is retreating back toward 4Y lows. The Energy complex is falling under pressure again, with Brent testing the 2014 floor, and WTI just off 16M lows despite API data last night showed a huge draw from stockpiles. We get New Home Sales at 10, DOE data at 10:30 — A small POMO at 11 – $US13B 2Y floater auction at 11:30 — Fed’s Mester speaks at 12:05 — at 1 Fed’s Evans speaks as we get a $US35B, 5Y auction, and Rosh Hashanah begins at Sundown