Barchart Morning Call
Overnight Developments
Global Financial Calendar
Barchart.com provides Financial Quotes, Charts and Technical Analysis for Stock and Commodity Traders.
- Global stocks this morning are weaker with the Euro Stoxx 50 down -0.61% and Mar S&Ps off by -5.10 points. The dollar is higher and most commodities are lower as the markets await a meeting later today between Greek Prime Minister Papademos and his country's political leaders to discuss the implementation of additional fiscal measures needed to secure a second bailout from the EU. The Greek newspaper Ta Nea reported without saying where it got the information, that Greece must cut spending by 3.2 billion euros this year to get approval from the EU, the ECB and the IMF for a new financing package. The so-called troika and the Greek government so far have agreed to cuts of about 2.5 billion euros. European automakers fell and led the overall market lower after Dec German industrial production unexpectedly dropped -2.9% m/m, the most in nearly 3 years and much weaker than expectations of unchanged m/m, as the debt crisis weighed on confidence and the global economic slowdown undercut demand. On the positive side, the cost of the Markit iTraxx SovX Western Europe Index of credit default swaps to insure against a default on European government debt fell 2 bp to 319 bp, a 3-month low.
- Asian stocks today closed mostly lower with Japan down -0.13%, China -1.85%, Australia -0.51%, South Korea +0.34%, India -0.48%. Asian stocks weakened after China's Ministry of Industry and Information Technology said China's industrial output will probably slow this year as "The global economy is slowing down, Europe's sovereign-debt crisis is deepening and the downside risks to the world economy are rising with international demand still slack and global commodities and financial markets continuing to be volatile." The yen fell to a 1-week low against the dollar after government data showed Japan carried out so-called stealth intervention to weaken it in Nov. Japan's Ministry of Finance said the nation sold 1.02 trillion yen ($13.2 billion) against the dollar the first 4 days of Nov in unannounced or "stealth" intervention after selling a record 8.07 trillion yen on Oct 31 when they yen climbed to a post WWII high of 75.35 against the dollar. Finance Minister Azumi said he won't rule out any options to curb the yen's appreciation and that he will take action whenever necessary. The Australian dollar rose to a 6-month high of $1.0823 after the RBA unexpectedly left the benchmark interest rate unchanged at 4.25% when market expectations were for a 25 bp cut to 4.00%.
- March S&Ps this morning are trading down -5.10 points. The US stock market on Monday finished slightly lower on concern that a lack of resolution to the ongoing Greek debt-swap talks may lead to a Greek default: Dow Jones -0.13%, S&P 500 -0.04%, Nasdaq Composite -0.13%. Bearish factors Monday included (1) carry-over weakness from a slide in European stocks as Greek debt-swap negotiations continue without a resolution, (2) the statement from Fitch Ratings that said a Greek disorderly default "cannot be wholly discounted," (3) the warning from German Chancellor Merkel that "time is running out" for Greek leaders to meet the conditions of the troika for additional bailout funding, (4) weakness in homebuilders after they were downgraded by Raymond James because of valuation concerns, and (5) weakness in energy and commodity producers after the IMF warned that economic growth in China may be cut in half if the European debt crisis worsens.
- Bullish factors included (1) comments from St. Louis Fed President Bullard who said economic growth in the U.S. may exceed 3% this year and accelerate in 2013 and that the jobless rate may fall below 8% by the end of 2012, (2) better-than-expected European economic data that reduced concern the European debt crisis will stymie growth after Dec German factory orders rose more than expected and Feb Euro-Zone Sentix investor confidence climbed to a 7-month high, and (3) decent Q4 earnings results so far with 66% of the 268 companies in the S&P 500 that reported quarterly results since Jan 9 have beaten earnings projections.
- March 10-year T-notes this morning are down -1 tick. T-note prices on Monday improved on increased safe-haven demand over concern Greece may yet default on its debt: TYH2 +11.0, FVH2 +4.7, EDM2 -1.5. Bullish factors Monday included (1) concern that a lack of resolution to the ongoing Greek debt-swap talks may lead to a Greek default, (2) the action by Greek Prime Minister Papademos to request that the Greek finance ministry prepare a document on the implications of a Greek default. Bearish factors included (1) comments from St. Louis Fed President Bullard who said that better-than-forecast data on the economy such as the employment rate indicate that more Fed asset purchases are unnecessary and (2) supply pressures ahead of the Treasury's $32 billion 3-year T-note auction on Tuesday.
- The dollar index this morning is higher with the dollar/yen +0.29 yen and the euro/dollar -0.30 cents. The dollar index on Monday strengthened as the euro declined over concern Greece's political leaders will fail to reach an agreement on implementing the necessary austerity measures it needs to ensure a second bailout from international creditors: Dollar Index +0.145, USDJPY -0.056, EURUSD -0.00293. Bullish factors included (1) increased safe-haven demand for the dollar as Greek debt-swap negotiations continue without a resolution, (2) the statement from Fitch Ratings that said a Greek disorderly default "cannot be wholly discounted," and (3) the warning from German Chancellor Merkel that "time is running out" for Greek leaders to meet the conditions of the troika for additional bailout funding. Bearish factors Monday included (1) the larger-than-expected improvement in the Feb Euro-Zone Sentix investor confidence which rose to a 7-month high and (2) the larger-than-expected increase in Dec German factory orders, which is euro positive.
- Mar crude oil prices this morning are down -71 cents a barrel and Mar gasoline is +0.50 of a cent per gallon. Crude oil and gasoline prices on Monday finished mixed as a stronger dollar undercut crude while a surge in European gasoil prices boosted gasoline: CLH12 -$0.93, RBH12 +1.35. Bullish factors included (1) strength in gasoline after an extreme cold snap in Europe lifted gasoil prices to a 3-month high, which may boost demand for U.S. gasoline exports and (2) reports that rebels attacked and damaged oil pipelines and installations in Nigeria, which may reduce exports from Africa's largest oil producer. Bearish factors included (1) strength in the dollar, which discourages investment demand in commodities, (2) the ongoing debt-swaps talks in Greece that continue without a resolution, which bolsters concern that Greece will fail to take sufficient steps to avert a default, and (3) a report from the IMF that warned economic growth in China, the world's second-largest crude consumer, may be cut in half if the European debt crisis worsens.
Global Financial Calendar
| Tuesday 2/7/12 | |
|---|---|
| United States | |
| 0745 ET | ICSC (Int?l Council of Shopping Centers) weekly retailer sales. |
| 0855 ET | Redbook weekly retailer sales. |
| 1000 ET | Fed Chairman Ben Bernanke testifies to the Senate Budget Committee on the economic outlook and the Federal budget situation. |
| 1000 ET | Feb IBD/TIPP economic optimism expected +1.1 to 48.6, Jan +4.7 to 47.5. |
| 1130 ET | Weekly 4-week and monthly 1-year T-bill auctions. |
| 1300 ET | Treasury auctions $32 billion 3-year T-notes. |
| 1500 ET | Dec consumer credit expected +$7.000 billion, Nov +$20.364 billion. |
| Japan | |
| 0000 ET | Dec Japan coincident index CI expected 93.1, Nov 90.3. Dec leading index CI expected 93.8, Nov 93.2. |
| 2330 ET | Jan Japan bankruptcies, Dec -6.3% y/y. |
| France | |
| 0245 ET | Dec French trade balance expected -5.350 billion euros, Nov -4.412 billion euros. |
| Germany | |
| 0600 ET | Dec German industrial production expected unchanged m/m and +4.4% y/y, Nov -0.6% m/m and +3.6% y/y. |
| Canada | |
| 0830 ET | Dec Canada building permits, Nov -3.6% m/m. |
No comments:
Post a Comment