The View From The Tower

Overnight Snapshot

 
The Day Ahead

0930hrs UK         UK Unemployment Rate (est 4.3% 3mths / 52.33K 3M/3M vs previous 4.3% / 168K)
1000hrs UK         EU Zew Survey Current Expectations (est -3.0 vs previous 5.1)
1230hrs UK         EU Bundesbank’s Joachim Wuermeling speaks in Germany
1330hrs UK         US Housing Starts (est 1.265mln / 2.55% mom vs previous 1.236mln / -7.0%)
1330hrs UK         US Building Permits (est 1.325mln / 0.53% mom vs previous 1.321mln / -4.1%)
1415hrs UK         EU Swedish PM Lofven meets with Indian Premier Narendra Modi followed by press conference
1415hrs UK         US San Francisco Fed President John Williams speaks in Madrid
1415hrs UK         US Industrial Production (est 0.34% mom vs previous 0.9%)
1415hrs UK         US Capacity Utilisation (est 77.9% vs previous 77.7%)
1500hrs UK         US Federal Reserve’s Randal Quarles testifies before House Financial Services Committee
1600hrs UK         US Philadelphia Fed President Patrick Harker speaks in Philly
1810hrs UK         US Chicago Fed President Charles Evans speaks in Chicago
1900hrs UK         EU Riksbank Governor Stefan Ingves speaks in Washington
2240hrs UK         US Federal Reserve Bank of Atlanta President Raphael Bostic speaks at Bloomberg seminar in Atlanta
 
US earnings releases today include JP Morgan, Citi, and Wells Fargo
 
The Day So Far….

STOCKS: US stocks closed higher yesterday with the biggest boosts coming from the technology and healthcare sectors as investors showed optimism on the current earnings season and concerns over the missile attacks on Syria eased. STOCKS HAD ENDED LOWER ON Friday with uncertainty over what was happening in Syria but the lack of reaction from Russia over the weekend strikes gave the markets an air of optimism. Netflix bounced around 7% post the close on their earnings release which showed increases in subscribers above expectations, after ending the regular day down 1.2%. Analysts are looking for S&P500 companies to report Q1 earnings up anything from 10%-20%, the biggest rise in 7 years. The Dow gained 212.9 points to close 24573.04, the S&P500 added 21.54 points to 2677.84,  and the Nasdaq100 rose 46.836 to finish at 6675.179
Regional stocks have struggled for any real direction in Asian hours. The Nikkei 225 went into the lunch break virtually unchanged, as the energy sector outperformed, while real estate names lagged, with post lunch trading generally sideways. - The Hang Seng was also virtually unchanged with consumer discretionary names leading the way higher, while consumer staples dragged, although trading dipped below the line in the post lunch session.. China's shares fared a little worse and lost around 0.3% in the early session. There was a brief bounce off of worst levels as China's Q1 GDP data data met expectations before a steady slide as the market approached the close. - Australia's ASX 200 was the early outperformer, adding a little over 0.3%, although most gains were steadily eroded in the afternoon to close almost unchanged - US equity index futures lodged gains, with the e-mini S&P 11 points better off, while the mini Dow added 135 points..
 
US TSYS: It has been a relatively sedate session for the space thus far as the latest round of Chinese GDP data held no surprises. T-notes have operated in a 3+ tick range. The curve has traded in mixed fashion with 2-Year yields easing a little, while yields from 5-Years out have edged higher, reversing some of the flattening that was seen on Monday. - The latest round of TIC flow data (for Feb) showed that China boosted its holdings of Tsys by the largest amount in 6 months, while Japanese investors shed their Tsy holdings.
JGBS: Futures edged higher this morning, finishing the session at 150.89 (+2 ticks), while super-long paper experienced some modest underperformance in cash dealing. The 5-Year sector outperformed heading into today's 5-Year JGB supply. - Swaps were a tighter from 7-Years out, while shorter maturities were mixed. - The modest JPY uptick has supported the space, while the Nikkei went into the
lunch break virtually unchanged.
 
OIL: Crude ticked higher overnight, with WTI & Brent adding around $0.30 to last trade at $66.50 & $71.70 respectively. - Traders await the weekly API crude inventory estimate on Tuesday, with analysts looking for a headline crude draw in Wednesday's DoE release.
 
GOLD: The yellow metal ran out of steam in front of $1350/oz in Asian hours, last trading unchanged around $1345.
 
FOREX: GBPUSD ran to fresh post-Brexit highs in early Asia-Pacific trade topping out at 1.4354, last dealing at ~1.4340. - USDJPY has a brief look below 107.00, but bears couldn't gain a foothold below the figure, with the cross last trading  back at ~107.05. EURUSD stuck to a tight range. - The commodity currencies took a hit, despite Chinese GDP meeting exp. & the RBA minutes revealing little in the way of fresh information. AUDUSD gave back around 15 pips to trade at 0.7765 last, as the cross ran out of steam in front of the 55-DMA. NZDUSD softened alongside AUDUSD to last trade at ~0.7350. The IMF's latest Article IV on NZ noted that it sees NZ growth remaining around 3.0% (although it did highlight downside risks over the medium term), with the Fund deeming the RBNZ's MonPol "appropriately expansionary". USDCAD last trades 10 pips or so higher at 1.2575.
 

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