Thomson Reuters
Good Morning! SPX back over 200dma, and M&A (PFE for AGN chatter) coupled with Options players adjusting their books into tomorrow's expiry have the S&P up 35bp in the early go. Over in Europe, the DAX got gappy to the upside as the benchmark index gets upside it's own 200dma with every sector rallying, driven by sharp buying in Industrials and Materials shares - while Tech shares are lagging as the street awaits the latest "unicorn" to go public on Wall street, with SQ pricing last night well below it's intended range. The FTSE is up 1.4% as miners rip higher, despite benign bids in the underlying commodities. Over in Asia, Shanghai added 1.3% and Shenzhen 3% into the doubling of margins on Monday, while the Nikkei rose 1.1% as Japan posts its 1st trade surplus since March. EM Asia all closed well in the green, while Aussie jumped over 2% on the back of miners led by BHP.
The US 10YY is off small after holding 2.25% in the overnight, following European yields slightly lower. Fed Minutes are being interpreted hawkishly by the global papers, and that "Policy Sensitive" 2YY is climbing slightly while Fed Funds remain unchanged at 66%. The Dollar is retreating against the basket, with the Yen gaining upward momentum as the BOJ stands pat overnight, disappointing doves - whiule that Euro is well bid over 1.07 despite ECB's Praet talking additional easing. With the weaker $, we have a tailwind for commodities, helping Zinc rebound from 6Y lows and Nickel 7Y lows - but Gold is showing a bounce of the "dead-cat" variety, and Copper remains in the red. The Oil complex is giving up a very tentative bid, with WTI in the red as the tractor-beam of spot contacts weigh heavy - and Brent coming in from its early peaks.
Ahead of us today, we get the ECB minutes at 7:30, ahead of the Philadelphia Fed Business Outlook and US Weekly Jobless Claims at 8:30. 10am brings the US Leading Index, and energy players will be focused on Natty inventory data at 10:30. At 11am, we get the US Treasury's announcement of next week's auction sizes (2s-5s-7s) - and Fed's Lockhart Speaks on U.S. Economy in Atlanta at 12:30, just in front of the Auction of $13B in 10Y TIPs at 1. After the close, Fed Vice Chair Fischer Gives Remarks on Emerging Asia at 4:30. Down in Washington, the House convenes at 9am; votes planned on H.R. 3189, which would make changes to the Federal Reserve's operations. Bill has drawn White House veto threat, would require GAO audit of Fed - and at the same time a House Judiciary panel holds hearing on Syrian refugee crisis.