Dave Lutz, head of ETFs at JonesTrading, has an overview of today’s markets.
- US markets are in the green Tuesday morning, boosted by a tech rebound.
- The rest of the world is mostly in the red.
- Oil and copper are higher while gasoline is lower.
Morning! US Futures are up small, led by Tech rebounding 15bp – Gold, Yen, Swissie all remain elevated near y’days highs tho as peeps digest the DACA headlines impact on Tax Reform and the Debt Ceiling, so we need to see what happens after the NY Open. Sea of red overseas as almost every European sector was in negative territory, with only Autos higher as Daimler gets upgraded. DAX is down 10bp as Fins continue to get hit as Sov Yields weigh. FTSE breaking down worse, off 60bp with every sector firmly red. Fins seemed to be the main weight in Asia – TOPIX up small – Hang Seng lost 40bp despite Tencent rallying – Shanghai added small – KOSPI down 30bp and Aussie lost 30bp. Volumes globally decent, pacing their 20day average overall.
10YY showing a slight bounce after collapsing yesterday, with the Fed Funds at a 36% chance of a December Hike, down from 42%. Eyes remain on the Oct 5 Bills, which are bid higher yet again after yesterday’s sloppy auction. The DXY is barely bid early – Euro climbing small ahead of ECB tomorrow – The Loonie up small as traders see a 43% chance of a hike today – A$ breaking downside 80c as GDP posts light, while that $ /Y seeing some life from 108.50 on a sharp drop in Japan Wage Growth. Ore was hit for 4.5% in China to 3week lows, but Hurricane rebuild hopes has Copper bid again. Oil adding to yesterday’s gains and Gasoline off over 1% as Harvey recedes and Irma approaches – Agriculture traders are awaiting to see if FCOJ continues to show a squeeze after yesterday’s Irma induced surge.