Morning Call For Wednesday, Sept. 20

OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ17 +0.03%) this morning are unchanged ahead of the conclusion of the 2-day FOMC meeting today and expected announcement by the Fed of how and when they will reduce their balance sheet. Strength in energy stocks is limiting losses in the overall market with Nov WTI crude oil (CLX17 +1.16%) up +1.16%. Crude prices rose after data late Tuesday from the API showed U.S. crude supplies rose +1.44 million bbl last week, less than expectations of a +3.9 million bbl increase. Also, API reported that U.S. gasoline stockpiles fell -5.06 million bbl last week, more than double expectations for a -2.09 million bbl draw. Global stock markets also found support on optimism in the world economy after the OECD predicted that global 2017 GDP will climb to 3.5%, up from 3.1% in 2016. European stocks are down slightly by -0.15%, as weakness in exporters leads the overall market lower after EUR/USD climbed to a 1-week high. Asian stocks settled mixed: Japan +0.05%, Hong Kong +0.27%, China +0.27%, Taiwan -0.54%, Australia -0.08%, Singapore -0.24%, South Korea -0.01%, India -0.01%. Japan's Nikkei Stock Index eked out a new 2-year high today and found support on strength in the Japanese economy after Japan Aug exports rose a more-than-expected +18.1% y/y, the biggest increase in 3-3/4 years.

The dollar index (DXY00 -0.13%) is down -0.10%. EUR/USD (^EURUSD) is up +0.10% at a 1-week high. USD/JPY (^USDJPY) is down -0.30%.

Dec 10-year T-note prices (ZNZ17 +0.09%) are up +5 ticks.

The Organization for Economic Cooperation and Development (OECD) said that the global economy is getting stronger and more stable and predicts global 2017 GDP of 3.5%, up from 3.1% in 2016, and expanding to 3.7% in 2018, the strongest since 2011.

German Aug PPI rose +0.2% m/m and +2.6% y/y, stronger than expectations of +0.1% m/m and +2.5% y/y.

The Japan Aug trade balance shrank to a surplus of 113.6 billion yen, wider than expectations of +104.4 billion yen. Aug exports rose +18.1% y/y, stronger than expectations of +14.3% y/y and the largest increase in 3-3/4 years. Aug imports rose +15.2% y/y, stronger than expectations of +11.6% y/y.

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