What Are Traders Chatting About This Morning? Copper ...
Good Morning! US futures are starting under pressure, with the S&P off 40bp early - we continue to focus on expiry which may "pin" SPY near 200, so watch these strikes. Markets overseas under solid pressure, led by a 1.7% drop in the FTSE as Miners were under sharp pressure overseas on Copper and Citi downgrading Ore prices: Anglo, Glencore, Rio and BHP all off sharply in London trade. Despite the EU's Basic Resource Index being off 6%+, Germany is outperforming buoyed by HC and Utilities, as the OMT is declared legal in EU (clears way for ECB QE) - turnover is solid, with the DAX trading 1.5x normal volume. Despite the Oil volatility, Saudi's market registered strong gains again, and Russia's MICEX is up small. Japan was off 1.7% as the Yen leapt to 1M highs despite chatter BOJ to downgrade Inflation - China gave back small - and Aussie was hit for 1%, weighed down by those Miners
The US 10YY is weakening this AM (ECB QE as German Bunds remain well bid), and while the $ is losing ground to the Yen, it continues to gain against Euro. Focus overnight was not on Oil, but on Copper, which collapsed in Asian trade, and closed down 7%. It's off 5% right now after being 3% weaker yesterday. Crude recovering from being off 2% after a Huge build API last night - DOE 10:30 today - It just broke in the green, following Natty which leapt sharply yesterday, and is adding another 5% this AM (10% in 2 days). Scheduled catalysts today include Fed's Plosser speaking on the Economy in Philadelphia at 8, Advance Retail Sales for December at 8:30, Mark Carney testifies to lawmakers at 9:15, at 10 US Biz Inventories, and 10:30 US Crude Inventories. 1pm we have the Auction of $13B in 30Ys ahead of the Beige Book's release at 2pm. Earnings focus is on the Fins (and if ITB can recover from KBH), which has underperformed into #s. JPM reports, stock is off 2% - let's see if the Conference Call is a "Buy the News"