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Dave Lutz, head of Exchange Traded Funds at JonesTrading, has a quick overview of what traders are watching on Tuesday.
- US stock futures are barely positive, although the Nasdaq is adding to its record close Monday, as earnings reports roll in. Some major components of the Dow Jones Industrial Average including 3M, DuPont and Caterpillar reported soft earnings or forecasts. In currencies, the Canadian dollar is rallying after remarks from Bank of Canada Governor Stephen Poloz on Monday that suggested the bank would not be eager to cut interest rates any further. House-price numbers for August from S&P/Case-Shiller are due at 9 a.m. ET. The Conference Board’s consumer confidence index for October will be released at 10.
Good Morning! US Futures are up small, with QQQs adding to their record close as a sea of Earnings reports roll across my Bloomie. It’s a mixed bag across the Atlantic, with Fins coming under pressure in Europe early – Numerous Italian banks just halted limit down and DB off 3%. The DAX is up 30 bp to a new 2016 peak tho, as Basic Resource Stocks continue to act well on Anglo headers, and Telecom jumping on Orange #s. The Miners have London gaining 40 bp, while Discretionary shares are under some pressure. Over in Asia, Shanghai closed basically flat – Weaker GDP weighed on South Korea – Nikkei climbed 80 bp to 6month highs as the Yen broke lower – Aussie climbed over 50bp as the Miners rallied. Gains in the ASX were tempered late by the Dreamworld tragedy, while Hong Kong was slightly lower with Macau +2% one of the few bright spots thanks to upgrades.
We have some decent selling of Gilts and Bunds ahead of Mark Carney and Mario Draghi later today – driving the US 10YY thru yesterday’s peaks and nearing 1.8%. The DXY is flat as Fed Funds rest at 74% for December – The Euro remains near seven-month low despite a stronger IFO survey outta Germany, while the Loonie continues rallying on Poloz comments last night. The $/Y remains in focus, busting upside 104.50 in the overnight. Metals are on Fire this AM. Zinc, Nickel, Copper and Lead all 2%+ higher. Ore was limit up in China to the highest since 2014 – Oil is adding 50bp as it continues to hold $50 tests, while Natty is rebounding 80bp from yesterday’s 4%+ smack. Softs look marginally bid across the complex.
Ahead of us today, we get FHFA House Price Index / Case-Shiller at 9am. The Bank of England Bond-Buying Operation Results hit at 9:50, just before the 10 am release of US Consumer Confidence Index and Richmond Fed. At 10:30 ECB President Draghi Speaks in Berlin, right when UK’s Carney Appears at House of Lords Economic Committee. At 1pm we have the US Treasury Auction of $26 Bln 2-Year Notes, and at 1:20 Fed’s Lockhart (NonVoter) Speaks. After the close, we get API Inventories for crude, along with a sea of earnings headlines: AAPL, P, COF, DFS, ESRX, CMG among others.