JonesTrading’s Dave Lutz has a roundup of what traders are talking about right now:
Good Morning, and Happy Weds! US futures are holding onto yesterday’s China induced gains, but we continue to see growth concerns with Russell lagging again early. Focus clearly on FOMC today (2pm headlines / 2:30 presser). EU is outperforming as inflation comes in light, with the DAX adding 50bp in decent volume. FTSE is clinging to a small gain, and UK’s Sterling is slightly higher despite tomorrow’s Scotland vote being “too close to call” (take Polls with a grain of salt next 24 hours). Countinue to watch for Ukraine stress, as Russia’s MICEX off 2% as another oligarch was accused of money laundering and placed under house arrest. Over in Asia, Main recipient banks of Chinese stimulus led the rally overseas — HK up 1% and Shanghai 50bp — but reaction was muted as the Stimulus is seen as light and temporary.
The US 10YY is slightly lower, while Germany Sells Two-Year Notes at Record-Low Yield of Minus 0.07%. Our “Policy sensitive” 2YY is nearing yesterday’s peaks (It barely moved yesterday, telling me the rally was more China than Hilsenrath opining in WSJ) – The A$ is retreating from the surge yesterday, weighing on some commodities and growth — Copper is off 50bp. Into DOE data today, WTI is unchanged, taking a breather from this week’s short-covering surge (OPEC, Libya, China all factors). Keep an eye on Wheat and Corn — they have been seeing short-covering rallies into the afternoon hours this week.
Some names to focus on: YHOO as BABA reaching a fevered pitch, with chatter the book is 20x over with little price sensitivity / M&A headlines impacting RAX (off 18%), DD (Trian), AUXL (Poison Pill), Adidas (Activist investors looking at taking stake) / Macau names continue to tumble / Energy Squeezing higher / Earnings: Waiting on FDX (10% Transports) and LEN (10% ITB) pre-open. Scheduled Catalysts ahead of us today include CPI, Current Account Balance at 8, NAHB Housing Market Index at 10, DOE data for Crude at 10:30 — NO POMO at 11 — at 2pm we get the FOMC Rate Decision, and 2:30 the Yellen Presser. Congrats to our local teams here — Orioles and Nationals both clinched their divisions last night