Dave Lutz of Stifel Nicolaus has a summary of what traders are talking about ahead of today’s big jobs report.
Good Morning! US futures are slightly higher, and we have light trading in Europe ahead of US Jobs Report. Aside from a one hour phone call between Obama and Putin that yielded no momentum — things were very quiet on the Ukraine front. Ukraine’s FX is acting well early, and Russia’s equity market is up 1%, despite the heavy RSX put buying yesterday. In Europe, the DAX is off 1% in light trading, weighed down by their industrials. The Nikkei hits a 5week high, gaining 1%, while Shanghai was up small, despite their first corporate bond default in recent memory. As we have been discussing, India stocks remain on a sharp upward trajectory as elections are viewed as a positive catalyst — the Sensex closed at a record high overnight, gaining almost 2%. Overall Materials and Property stocks are giving back some recent ground globally, while Financials continue their upward momentum.
The 10YY is off small, after being rejected from the 100dma again overnight. The Yen has a slight bid to it, but the 2 FX that are the story this week are keeping their upward trajectory: The € is leaping further, hitting new 2 ½ year highs against the Dollar, and the shift back towards risk was evident in Sydney, where the Australian dollar jumped to a three-month high overnight. The DXY has smashed under the 80 level, providing a big tailwind for commodities — that said Copper is off 2% (China Credit Concerns), and Nat Gas is giving some back in the USA. Oil has a bid to it, after WTI bounced near the $US100 level yesterday, while it’s discount to Brent has narrowed back towards the $US6 level. The AG complex is en fuego — with Coffee, Corn, Wheat, Soy and Cotton all 1%+ higher. The main event today will be Employment in the States at 8:30 — with the weather providing a big skew — We also get Trade Balance at 8:30 — There is no POMO operation today — we have Dudley (done) speaking at 12pmET and Bernanke delivers comments at 12:30pm — followed by Consumer Credit at 3pm. Reminder, we have daylight savings this weekend in the States!