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Dave Lutz, head of ETFs at JonesTrading, has an overview of today’s markets.
- Most of the global markets are green. The US Senate passed a budget Thursday night and both the dollar and 10-year yield are rising. The euro is falling as Catalonia tensions continue.
Good Morning! US Futures are on the upswing into Monthly Expiry today. The “Trumpflation” bets seem to be moving, with Industrials and Smallcaps up 40bp, double the efforts of the SPY. It’s a wide sea of green overseas as well, where the DAX is climbing 35bp – Autos acting well behind Volvo, Miners acting great as Ore jumps in China, and Banks are rebounding as Sov Yields squirt higher. Stockholm is up 1% as Ericsson leaps, but the IBEX is lagging as Catalan Banks get hit. London up 25bp, with every sector climbing except Staples and healthcare. In Asia, Nikkei 225 up 14in a row, longest streak since the 60s, as investors await Abe’s re-election this weekend – Hang Seng rebounded from yesterday’s smack, gaining 1.2% – Shanghai up 20bp – KOSPI added 70bp – Taiwan off small as AAPL suppliers see continued weakness – Aussie added 20bp, continuing its longest winning streak in 15months
The 10YY and Greenback popped overnight on headers the Senate had passed a Tax resolution, but heavy selling in Bunds is keeping the lid on any Treasury rally, keeping our 10YY upside 2.35% early. DXY in rally mode, Euro weaker as Catalona angst resurfaces, testing $1.18 against the Greenback – Kiwi$ breaks down again – $/Y back upside 113 into the election, and Sterling is under pressure as Brexit headers roll. Ore squeezes almost 6% in China overnight, propelling Nickel up 3% and Copper 1%. Gold is breaking lower, but holding 1280 thus far. The Oil complex under good pressure as stops go off on the $51 break. Natty continuing yesterday afternoon’s rally, adding 1% early.