Morning Call For January 12, 2015

OVERNIGHT MARKETS AND NEWS

March E-mini S&Ps (ESH15 +0.55%) this morning are up +0.57% and European stocks are up +1.62% as health-care companies rallied on increased M&A activity and promising drug-test results from Bristol-Myers Squibb. Also, Greek sovereign debt concerns eased and pushed the Greek 10-year bond yield down to a 1-week low and gave a boost to European stocks after Syriza leader Tsipras said that a government led by his party would repay Greek debt maturing in March and keep Greece in the Eurozone. Asian stocks closed mixed: Japan closed for holiday, Hong Kong +1.45%, China-0.93%, Taiwan -0.40%, Australia -0.78%, Singapore +0.19%, South Korea -0.14%, India +0.46%. China's Shanghai Stock Index slipped to a 1-week low amid concern the recent rally in Chinese equities to a 5-1/3 year high has been excessive relative to the outlook for the economy. Commodity prices are mixed. Feb crude oil (CLG15 -2.52%) is down -2.40%. Feb gasoline (RBG15 -1.56%) is down -1.36%. Feb gold (GCG15 +0.30%) is up % at a 1-month high on speculation that Friday's weaker-than-expected wage growth will prompt the Fed to go slow in raising interest rates. Mar copper (HGH15-0.44%) is down -0.31%. Agriculture prices are mixed ahead of this morning's USDA monthly WASDE crop production report. The dollar index (DXY00+0.38%) is up +0.32%. EUR/USD (^EURUSD) is down -0.34%. USD/JPY (^USDJPY) is up +0.57%. Mar T-note prices (ZNH15 -0.01%) are up +2 ticks.

A couple of ECB members expressed differing views over the weekend on whether the ECB should begin quantitative easing after ECB Executive Board member Lautenschlage said in an interview with Der Spiegel that conditions were not yet grave enough to warrant government bond purchases, while Bank of Italy Governor and fellow ECB member Visco said in an interview with Welt am Sonntag that there was a threat of deflation and that government bond purchases would be the most effective tool to combat it.

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