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Tag Archives: overseas markets

Weakness in Europe Carrying Over to U.S. Markets in the Pre

Morning Notes

- Mixed action in overseas markets
- Nikkei showed notable strength, closing up 1.2%, after the BOJ announced they would leave rates unch’d while increasing growth projection to +3.3% from +2.1%
- UK Q4 GDP came in significantly lower than expected- GDP actually contracted instead of the expected expansion, coming in at -0.5% vs. +0.4% expected
- FTSE sold off on that data news as did the pound
- German Consumer Confidence number came in strong, hence the DAX is outperforming the rest of the European bourses
- Spain’s Finance Minister announced that Spanish banks will need to raise their core capital level to 8% and that capital could be raised through financial mkts, or the gov’t will partially take over the banks- he also specified that it will take <20B EURO to take over weaker Spanish banks
- The above news on Spanish banks pushed the IBEX down about 1% and is adding pressure to foreign banks in general
- Gold particularly weak this morning, other commodities seeing pressure
- Dollar is showing strength, particularly due to weakness in the pound
- November Case Shiller: -1.59% vs. -1.50%; prior revised down to -0.84% from -0.80%
- Consumer Confidence @ 10a; November FHFA Housing Prices at 10a;
- Also note that Obama’s State of Union speech will commence at 8p
- Obama is expected to push spending in areas like renewable energy, education
- Obama to address American competitiveness, need for budget cuts (though he will probably not specific in which areas those cuts are needed)
- FOMC meeting kicks off today (two day meeting)- a decision will be disclosed tomorrow afternoon
- S&P futures are down in the premarket, about 5.5 handles from FV

Will the Strong ADP Number Be Enough to Push Futures into the Green?

Morning Notes

- Overseas markets are net lower today
- In China, the PBOC said that it may conduct a monthly review of reserves rates on banks
- China’s HSBC PMI came in in line
- Both Germany and Eurozone Services PMI came in solidly
- However, European markets are down
- Drop in commodities yesterday is adding noticeable pressure to the material sector, particularly in Germany
- UK Construction PMI showed a contraction
- Oil is weak again today
- Dollar is up again
- ADP Employment Change: 297K vs. 100K; prior revised down to 92K from 93K
- Latest ADP data is lifting futures as well as crude oil and dollar
- This ADP number is the highest in history
- ISM Non Manufacturing data out at 10a
- Gold is lower and making new lows ahead of the bell
- S&P futures are down 4 handles from FV ahead of the open and on the S3 buy signal

Finally, Some Economic Data to Spice Up the Market!

Morning Notes
- Overseas mkts mixed in the overnight
- Asian mkts were mixed w/ Shanghai down 90bps and the Hang Seng up 20bps
- European mkts are flattish

Spice Up the Market!

- There were reports out that China may buy Portuguese sov debt (Dean has been talking about how there have been some great deals on sov debt for a few months now)
- China’s debt purchase may help assuage debt issues in Portugal (Portuguese bond yields pushed higher nonetheless today)
- This week has been extremely quiet, volumes- and new-wise
- There are at least a few items on the economic calendar for today to help provide a little bit of action
- Q3 GDP (third estimate): +2.6% vs. +2.8%; first revision: +2.5% from +2.0%
- Q3 GDP Deflator: 2.1% vs. 2.3%; first revision: 2.3% from 2.2%
- S&P still flattish after an initial pull back after GDP release
- Dollar seeing a little bit of pressure following GDP release
- Existing Homes Sales @ 10a ET
- S&P futures are up half a handle from FV and trading b/w S3 and R3

Futures Hovering Over S4 Pivot For First Time In A Few Weeks

Spain Potential Downgrade

Morning Notes
- Overseas markets are all lower this morning following news that Moody’s may downgrade Spain
- Adding further weakness in the markets is the Tankan Survey results in Japan, which showed that business confidence in the country has fallen for the first time in two years
- JPY weakness has added little support to Nikkei, which closed down just 10bps
- Also, UK unemployment rate came in higher than expected
- Dollar up small
- Gold and oil are down
- NY Empire Manufacturing Survey: 10.57 vs. 3.00; prior was -11.14
- November Core CPI: +0.1% vs. +0.1%
- November CPI m/m: +0.1% vs. +0.2%; prior was +0.2%

- Futures not really reacting to data release
- Other economic items on the calendar for today: Industrial Production and Capacity Utilization at 9:15a ET; NAHB Housing Idx at 10a; Crude Inventories at 10:30a
- S&P futures are down about 4 handles from FV
- Tight pivots in the Spooz today- we are on the S3 buy signal , although that could change quickly given that we are hovering right above S4 and we had been on the S4 sell signal earlier in the pre

Fairly Muted Action Ahead of FOMC Rate Decision Today

Morning Notes
- Overseas markets seeing muted action ahead of FOMC rate decision today at 2:15p ET
- Asian markets were up small
- In Japan, Industrial Production and Cap Utilization were revised down

Fairly Muted Action Ahead of FOMC Rate Decision Today

- UK CPI rose slightly higher than expected
- Switzerland raised its 2011 GDP forecast
- Germany revised its 2010 and 2011 GDP forecast up
- Eurozone Industrial Production came in slightly worse than expected
- Gold up this morning
- Dollar showing weakness again
- Other economic items on the calendar for today: Business Inventories at 10a; FOMC decision at 2:15p
- Bank of India announced rate hike
- That along with BBY earnings at ~8a brought in the futures
- November Retail Sales: +0.8% vs. +0.5%; prior revised up to +1.7% from +1.2%
- November Retail Sales Ex Auto: +1.2% vs. +0.6%; prior revised up to +0.8% from +0.4%
- November PPI m/m: +0.8% vs. +0.5%; prior was +0.4%
- November Core PPI m/m: +0.3% vs. +0.2%; prior was -0.6%
- Futures recovering after the 8a pullback
- S&P futures are trading just below the R3 pivot level, up about 1.75 handles from FV
- Futures are on the R3 sell pivot signal

Weak Volume This Morning May Make For A Quiet Friday

Morning Notes
- Overseas markets are mixed- note: on low volume
- Shanghai Comp was strong, closing up slightly over 1%
- Strength in China attributed to better than expected Trade Balance number
- PBOC tightened its monetary policy as speculated by raising bank reserve requirement by 50bps, which was announced after their mkt close- no real reaction in overseas mkts though
- S&P futures were up in the pre market
- October Trade Balance: -$38.7B vs. -$44.5B; prior revised down to -$44.6B from -$44.0B
- Futures have pulled in since trade balance data release, pulling back below R3 pivot level
- Meanwhile, dollar bounces a bit
- S&P futures open on the R3 sell pivot signal
- U.Mich Prelim: 74.2 vs. 72.5
- Futures pull back following data release
- Now futures are up 1.5 from FV
- Treasury budget at 2p ET today

Jobless Claims Picture Appears to be Improving- Futures Push Higher

Morning Notes
- Overseas markets are mostly up this morning save for the Shanghai Comp, which is down about 1.3%
- Weakness in China attributed to rate hike rumors (again) potentially to come this weekend
- China canceled its 3-yr bond auction that was scheduled for today
- In Japan, Q3 GDP was revised; meanwhile,

Jobless Claims Picture Appears to be Improving

there are concerns of contraction for Q4
- Also, machine orders in Japan came in solidly
- ECB monthly bulletin came out, noting new there though
- BOE kept benchmark interest rates unch’d at 0.50%, expected
- Fitch downgraded Ireland
- Euro showing weakness this morning
- Strong jobs data out of Australia (came in more than double the consensus)
- Treasuries recovering a bit today after a few days of weakness
- Wholesale Inventories is the only item left on the economic data calendar today, to be released at 10a ET
- 30-yr bond auction results out at 1p
- S&P futures up small ahead of claims data
- Initial Jobless Claims: 421K vs. 425K, prior revised up to 438K from 436K
- Continuing Claims: 4.086M down from 4.427M
- Futures push higher off claims number
- S&P futures are now up 6 handles from FV, trading on the R4 buy pivot signal

Choppy Trade Before the Bell This Morning

Morning Notes
- Trading is mixed in overseas markets
- Interesting move in China- it announced it will change CPI data release to Saturday from Monday
- This move triggered speculation that rate hike will come soon, perhaps this weekend
- Hang Seng sold off 1.4% and the Shanghai closed down 95bps
- Nikkei, however, was up about 90bps, helped by a weaker yen
- German exports data came in weaker than expected
- Bank of France increase Q4 GDP outlook
- Dollar showing strength this morning
- Commodities are down a bit
- Nothing on the economic calendar for today (has been a quiet week so far for economic data releases)
- A couple of positive corporate news in the U.S., however: HD announced an improved outlook, raising FY11 guidance and COST reported solid earnings
- S&P futures are somewhat choppy this morning; currently up 1.5 handles from FV, trading on the S3 buy pivot signal

Tax Cuts For All

Morning Notes
- Overseas markets up in the o/n session
- President Obama gave a speech last night re: extension of tax cuts across all income levels for two years and extension of unemployment benefits; also to reduce payroll taxes and to allow biz investments to get getter tax treatment
- Shanghai Comp recovered nicely off its lows (was down as much as 1.5%), which it made when rumors were out that the PBOC would increase rates this weekend

Obama Tax Cuts

- Those types of rumors (of a rate hike) have been out in the past (it’s getting old so I’m not surprised at the stocks’ recovery off its lows)
- Also a rate hike is probably baked in by now; the main question now is how much of a rate hike they will see
- Australia kept benchmark rates unch’d
- JPY showed some strength, making the Nikkei the only index that was down among the global indices
- In Europe, Ireland rolled out its austerity plans to comply with the EU’s bailout pkg
- Euro is up while yields on sov debt of Spain/Italy/Greece/Portugal are up as well
- In commodities land, copper made a new high today; as a reminder, gold had made a new high yesterday
- Another quiet day on economic calendar: there is a 3-yr Notes auction today with results to be released @ 1p ET; IBD/TIPP Economic Optimism @ 10a

Nonfarm Payrolls Sucked

Morning Notes
- Overseas markets were mixed
- Comments out of China suggesting a switch from its looser monetary policy to a “prudent” one next year
- Mixed comments around Greece where S&P warned about a possible downgrade whereas an ECB official said he sees solid improvements in the country
- ECB President Trichet said he does not see a euro crisis coming, basically supporting the currency
- Dollar showing weakness this morning; euro up
- Futures quiet ahead of Nonfarm Payrolls @ 8:30a ET
- Other economic items on the calendar for today: Factory Orders @ 8:30a; ISM @ 10a
- Nonfarm Private Payrolls: 50K vs. 140K; October revised up to 160K from 159K
- Nonfarm Payrolls: 39K vs. 130K; October revised to 172K from 151K
- Unemployment Rate: 9.8% vs. 9.6%; prior was 9.6%
- S&P futures sold off harshly upon data release
- Dollar and treasuries sold off as well
- S&P futures are now down 6.5 handles from FV, trading up against S3 pivot level