Morning Call For Thursday, Dec. 13

Overnight Markets And News

Dec E-mini S&Ps (ESZ18 -0.02%) this morning are down -0.10% and European stocks are up +0.02%. U.S. equity futures and European stocks shed overnight gains as weakness in energy stocks drags the overall market lower. Jan WTI crude oil (CLF19 -1.33%) is down -1.17% on concern that crude production cuts by OPEC+ will be insufficient to avert a global oil surplus. Stocks had pushed higher in overnight trade on signs of a thaw in American-China trade relations. The U.S. Soybean Council reported that China bought 1.5 MMT to 2.0 MMT of U.S. soybeans, its first purchase since both countries began tit-for-tat tariffs. Mining stocks are higher as reduced trade tensions between the U.S. and China lifts copper prices, with Mar COMEX copper (HGH19 +0.51%) up +0.45% at a 1-week high. European stocks found support on reduced Brexit concerns after UK Prime Minister May beat back an attempt by members of her Conservative Party to oust her from power with a no-confidence vote. Gains in European stocks were limited on a report that the ECB will lower its Eurozone 2018 inflation and economic growth forecasts when its policy meeting concludes later this morning. Asian stocks settled higher: Japan +0.99%, Hong Kong +1.29%, China +1.23%, Taiwan +0.43%, Australia +0.14%, Singapore +0.36%, South Korea +0.35%, India +0.42%. China's Shanghai Composite and Japan's Nikkei Stock Index both climbed to 1-week highs as woes over global trade tensions ease on signs that the U.S. and China are both willing to compromise to end their trade disputes.

The dollar index (DXY00 -0.07%) is down -0.07%. EUR/USD (^EURUSD +0.10%) is up +0.09%. USD/JPY (^USDJPY+0.14%) is up 0.13%.

Mar 10-year T-note prices (ZNH19 +0-015) are up +2 ticks.

German Nov CPI (EU harmonized) was left unrevised at +0.1% m/m and +2.2% y/y.

U.S. Stock Preview

Key U.S. news today includes: (1) weekly initial unemployment claims (expected -5,000 to 226,000, previous -4,000 to 231,000) and continuing claims (expected +18,000 to 1.649 million, previous -74,000 to 1.631 million), (2) Nov import price index (expected -1.0% m/m and +1.3% y/y, Oct +0.5% m/m and +3.5% y/y) and Nov import price index ex-petroleum (expected -0.1% m/m, Oct +0.2% m/m), (3) Treasury auctions $16 billion of 30-year T-bonds.

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