REUTERS/Philippe Wojazer
Mario Draghi
Good Morning! US Futures are up slightly as the BoE stays unchanged (expected) - The main attraction of the morning belongs to Draghi (ECB Announcement at 7:45/Presser 8:30) - and Europe is thinking QE as their markets rally 60bp (near 6Y highs) in light volume. Consumer stocks are your main winners, while EU industrials and Fins are lagging. We had headlines from Putin defending the Ruble, but that did little to halt it's slide, but the MICEX remains in the green. Over in Asia, China leaps 4%, nearing 4Y highs in record volumes as 17 Securities firms closed limit up - all dovish hopes. Shanghai has now rallied 18% since the surprise rate cut 2weeks ago - $/Y hit 119.97 last night, helping Nikkei jump to a 7Y peak as Japanese polls show a landslide victory coming for Abe's LDP party, and Aussie popped 1% as retail sales came in better and the Miners had a strong day. Consumer stocks globally are outperforming as the price of Gasoline collapses.
The US 10YY is up small, but watch German Bunds under a little pressure into the ECB - The Euro is flat, but hovering around 2Y lows, but the DXY is higher with gains coming against Yen. With the higher $, commodities have a headwind, and we are watching Gold retrace back to $1200/oz, but dovish China hopes have Copper adding nearly 1% and Ore stabilizing (VALE comments helping). All eyes on the Oil patch, where headlines saying Saudi cuts selling prices to US and Asia and Iraq adding 300k bpd to the global supply just hit WTI into the red after being up 1%+ overnight. Natty gas remains under pressure into Inventory data as warmer weather hits the USA. Scheduled Catalysts include Challenger Job Cuts at 7:30, The ECB rate Decision at 7:45 followed by the Draghi presser at 8:30. Also at 8:30, we get weekly Jobless Claims data and Fed's Mester speaks. At 10:30 we get Natty gas Inventory data (Rig count has been dropping), at Noon we get ICSC Chain Store Sales Trends - finally at 12:30 Fed's Brainard Speaks on Financial Stability