JonesTrading’s Dave Lutz has a roundup of what traders are chatting about right now.
Good Morning! Us Futures are continuing last week’s Fed induced rally, gaining 20bp in early trade. This mirrors global strength, starting with a 1% pop in the DAX as Bunds get sold. The FTSE is 80bp higher, as Consumer Discretionary stocks act well — Materials issues the only group in the red. Ahead of the Greek Elections tomorrow, Greece’s Samaras made concessions — but their market is unchanged. Despite stability in the Ruble, Russia’s Micex is off 1% as Oil weakens. Over in Asia,The Nikkei was basically unchanged as Yen strengthened – China gained 1.6% and Hong Kong 1.3%, but Macau Casino stocks under pressure as the Chinese president warned to strengthen oversight. Despite Aussie cutting its Ore price estimate for 2015 to $US63/average — Energy and Materials stocks down under jumped in heavy covering, propelling the ASX 2%.
The 10YY is climbing higher, reversing Friday’s drop in Yields by 2bp — and German yields are back over 60bp. The Euro is slightly higher, but well under Friday’s opening levels as Expiry and diverging policies hit Euro to new lows against the Greenback, weakening the DXY despite slight $US strength against Yen. There is weakness across the Energy complex, as WTI/Brent have surrendered 2.5% gains to dive red (Saudi and UAE reaffirmed intentions to keep output at current levels) – Natty Gas Continues to gain downside momentum into next week’s expiry on unseasonably warm weather, Lotta chatter break of $US3.60 on Friday causing heavy Momentum selling. Natty is off 10% in 2 days. Wheat is jumping 1% as Russia limits exports — while Gold is up small, but remains under $US1200/oz.
At 8:30 we get Chicago Fed Nat Activity Index, while the Housing stocks will focus on Existing Home Sales for November at 10. Watch the Euro at 10 as well, we get Consumer Confidence from the Eurozone. Finally, at 1 we get an Auction of 2Y notes.
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