REUTERS/Paulo Whitaker
Traders work on the main floor of the BM&F Bovespa stock exchange market in Sao Paulo October 8, 2008. Brazil's benchmark stock index sank more than 5 percent in early trade on Wednesday as markets from Asia to Europe declined on concerns that efforts by central banks around the world to cut rates would not be enough to avert global recession.
US Futures are up 20bp, just off fresh all-time records. With the Russell coming off best day in 2 months, we are not seeing any major pullback in Momentum stocks overnight. There was a fair amount of "technical" buying yesterday, as Options expiry is a huge tailwind this week, and many major indices were able to get upside of key Moving Averages - IWM over 200dma, QQQ thru 50 and 100dmas, IBB bouncing off the 200dma, etc… In Europe, the DAX is up 1% in very heavy trade - 45% above normal trends. Despite the EU fins being in the red (Capital headlines) - most EU markets are euphoric as German investor confidence fell in May, sparking Dovish hopes from the ECB.
The Ukrainian situation had no major flare-up overnight, and Russia's Micex Index climbed over 1% percent, extending gains to a fifth day - the longest streak of increases this year. Over in Asia, focus was on Chinese investment, retail sales and factory output growth all disappointing - but there was muted response from China and Aussie markets. Japan leapt 2% as the Yen continued to weaken near 1M lows, and India leapt further on election results. Keep an eye on the breakout in Emerging markets, with the EEM trading at 5M highs this AM.