Stifel Nicholaus’ Dave Lutz has a quick roundup of what traders are chatting about right now:
Good Morning! Equity Euphoria continues, as the FTSE All-World equity index overtakes 2007 peaks – Dovish hopes in China, Japan and US — a Rush into Sov debt as PIIGS Yields collapse — and cooling off of Ukraine tension all macro backdrops for the rally. US Futures are adding 20bp early, mirroring gains seen over in Germany where volume remains light into the ECB tomorrow. A familiar pattern has emerged of late, however, where global equities fall under pressure into the EU close, only to rebound sharply in the afternoon. EM markets are strong, with India at Record Highs and the EEM working on a 10 day winning streak. Japan added 1% as the $US/Yen is the highest in almost 3 months, and China 50bp — but optimism buoyed the Aussie miners another 1% overnight. Globally, Industrials continue their upswing, and globally Banks continue to have tailwinds.
With Economic data strengthening in the USA, we have continued pressure in the Treasury complex, despite Yellen’s dovish overtures on Monday. The 10YY is up another 2bp, and trying to get upside of the 100dma in early trade — we have not closed above 2.8% since January 23rd. The DXY is mixed, caught between a weakening Yen, and the € seeing a cover bid as PIIGS yields collapse. In Commodities, Copper is adding 1%, and holding near highs as a massive quake hits in Chile’s exporting region — while Silver and Gold are both seeing buying as precious metals near 2M lows. The Energy complex remains under pressure, with WTI losing 50bp into the DOE inventory data later today — and Natty Gas is off 1% as warm weather hits the USA, and a very crowded trade unwinds. Scheduled catalysts ahead of us today include the prelude to the NFP number — we get ADP employment data at 8:15. At 9:45 we get ISM for NY, at 10 Factory Orders, at 10:30 the DOE data for Crude hits, 11 finds one of the largest POMO operations of the week, and we have 2 Fed Heads speaking — Lockhart at 12:30 (looks for Hike in 2H 2015) and Bullard at 4pm (He’s last said looking for a hike in Q12015)