Morning Call For April 7, 2015

OVERNIGHT MARKETS AND NEWS

June E-mini S&Ps (ESM15 +0.22%) this morning are little changed. The Euro Stoxx 50 index is up +1.21% as the European markets reopened after the Easter holiday and reacted positively to hopes for an easier Fed policy after last Friday's weaker-than-expected U.S. payroll report of +126,000. Asian stocks today settled mostly higher: Japan +1.25%, China +2.15%, Taiwan +0.43%, Australia +0.46%, Singapore +0.37%, South Korea -0.02%, India +0.04%, and Turkey -0.77%. The dollar index (DXY00 +0.71%) is sharply higher by +0.76% on higher U.S. inflation expectations after Monday's +5.8% surge in Brent crude oil prices. EUR/USD (^EURUSD) is down -0.0060 (-0.55%) and USD/JPY (^USDJPY) is up +0.36 (+0.30%). Jun T-note prices (ZNM15 -0.06%) are down -2 ticks.

Commodity prices are down -0.39% this morning as the energy and metals markets fell back after Monday's surge and as this morning's stronger dollar takes its toll. May crude oil (CLK15 -0.96%) is down -0.59 (-1.13%) and May gasoline (RBK15 -0.15%) is down -0.0069 (-0.37%). Jun gold (GCM15 -0.60%) is down -9.0 (-0.74%), May silver (SIK15 -1.43%) is down -0.300 (-1.75%), and May copper (HGK15 +1.31%) is up +0.021 (+0.75%). Grain and softs prices are trading mostly lower.

The Australian dollar saw some strength today after the Australian central bank today kept its key interest rate unchanged, which was more hawkish than market expectations of about a 50-50 chance of a rate cut. The markets are now expecting the Australian central bank to cut rates in May.

European bond yields fell today after last Friday's weak U.S. payroll report of +126,000 caused market participants to defer expectations of Fed tightening and after Greece indicated over the weekend that it will make its 500 million euro payment to the IMF this Thursday. 10-year bond yields fell by -5 bp to 1.25% for Italy, -7 bp to 1.64% for Portugal, and -22 bp to 11.84% for Greece.

U.S. STOCK PREVIEW

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