The surprise announcement also suggests OPEC+ may be getting more cautious about its outlook for global oil demand given the elevated threat of a potentially deep recession looming, says Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
U.S. stock futures are tracking European markets higher this morning thanks to a cooler-than-expected inflation print in Europe while news flow was otherwise mostly quiet overnight.
Economically, Eurozone PPI for February came in at -0.5% vs. (E) -0.3% m/m but a still lofty 13.2% vs. (E) 13.5% y/y. Despite the still elevated annual figure, the lower than expected print is bolstering risk assets this morning.
Today, there are three economic reports to watch in the U.S. including: Motor Vehicle Sales (E: 14.9 million), Factory Orders (E: -0.4%), and JOLTS (E: 10.4 million). Investors will want to see more evidence of slowing growth and a weakening labor market to reinforce hopes for both a less-hawkish Fed and soft landing in order for the recent stock market resilience to continue.
Finally, there is one Fed speaker to watch late in the day: Mester (6:45 p.m. ET).
“The banks are the main driver of oil, and really all risk assets today, as fading confidence in the financial system is reigniting fears that another crisis may be looming after we saw some of the biggest bank failures since 2008 in early March,” said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
“However, the banks are the main driver of oil, and really all risk assets, as fading confidence in the financial system is reigniting fears that another crisis may be looming, after we saw some of the biggest bank failures since 2008 in early March,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly higher and are extending Wednesdays’ gains following better than expected inflation data overnight.
Spanish CPI, which was the first inflation indicator to warn of the stall in disinflation, rose just 3.3% y/y, less than the 3.8% expectation and much lower than the 6% y/y reading last month. That’s offering some initial hope that disinflation has restarted.
Today focus will be on economic data, with Jobless Claims (E: 195K) the key report, although we also get the Final Q4 GDP (E: 2.7%). There are also two Fed speakers today, including Collins (12:45 p.m. ET) and Barkin (12:45 p.m. ET) and markets will look for additional confirmation that the Fed has finally pivoted.
What’s in Today’s Report:
Money flows are decidedly risk off this morning with stock futures lower while Treasury yields fall sharply amid continued worries about the global banking system.
UBS shares are down more than 6% after Jefferies downgraded the bank following its acquisition of Credit Suisse while the bank is also under investigation regarding its bankers role in helping Russian oligarchs avoid sanctions following the Russian invasion of Ukraine.
Economically, measure of Core CPI in Japan came in hot at 3.5% vs. (E) 3.4% y/y while the European PMI Composite Flash was strong, jumping to 54.1 vs. (E) 52.0. Both data points have hawkish implication for respective central bank policy in the near term but banking fears are preventing a move higher in yields.
Looking into today’s session, there are two economic reports to watch: Durable Goods Orders (E: 1.5%) and the PMI Composite Flash (E: 49.3) while there is one Fed speaker: Bullard (9:30 a.m. ET). Markets want to see signs of slowing growth, but not a collapse, in the data, and a less hawkish tone from Bullard.
Bottom line, banks have reemerged as the primary influence on markets in the back half of the week and if the weakness in the sector continues today, stocks will have a very hard time extending yesterday’s modest bounce. Conversely if banks are able to stabilize, we could see the S&P 500 move back towards the 4,000 mark.
What’s in Today’s Report:
Stock futures briefly spiked lower overnight in the wake of a hot CPI print in the U.K. but bond markets are steady and futures have largely stabilized as focus turns to the Fed.
Economically, U.K. CPI jumped from 10.1% in January to 10.4% in February, well ahead of estimates of 9.9%, however, both input and output PPI readings unexpectedly declined, easing some of the inflation worries this morning.
There are no notable economic reports today which will leave markets focused on the price action in the banking sector in the morning (meaningful weakness could drag the broader market lower) before attention shifts to the FOMC Meeting Announcement (2:00 p.m. ET) and Fed Chair Press Conference (2:30 p.m. ET) this afternoon.
A 25 basis point hike and no change to the dot plot is the consensus expectation but there are a lot of moving pieces to today’s meeting so watching the reaction from the Treasury market this afternoon will be critical in interpreting what today’s decision means for markets.
What’s in Today’s Report:
U.S. stock futures are tracking European shares higher with banks notably outperforming while bonds retreat.
Bloomberg reported last night that Treasury Department officials are reviewing options to temporarily insure all bank deposits in order to avoid a potential financial crisis which is helping support risk on money flows this morning.
Economically, the German ZEW Survey was mixed but the Current Conditions Index was importantly not as bad as feared, helping risk assets extend the week’s gains.
Looking into today’s session, there is just one economic report to watch: Existing Home Sales (E: 4.170 million) and given the focus on the recent banking turmoil as well as the March FOMC meeting beginning, it is unlikely to move markets.
As such, a sense of “Fed paralysis” is likely to begin to grip markets today but any outsized moves in the broader banking sector, headline driven or otherwise, has the potential to impact the broader equity markets. To that point, if FRC can finally stabilize, that would be well received by investors today.
What’s in Today’s Report:
Stock futures are little changed but cross-asset money flows remain cautious with Treasuries and gold both trading higher as the latest developments in the global banking sector are digested.
Swiss regulators brokered a deal for UBS to take over Credit Suisse for $3.2B over the weekend, a steep discount from CS’s $8B market value on Friday but global bank shares are relatively stable to start the week today helping the broader market hold steady in early trade.
The Fed and several other major central banks coordinated efforts to boost liquidity in dollar swaps over the weekend in their latest attempt to ease strains in the global financial system, which so far, is being received fairly well.
There are no notable economic reports today and no Fed officials are schedule to speak which will leave focus on the price action in banks today. If financials can hold above last week’s lows, that will be a positive, but if the selling pressure continues, the broader market is likely to be dragged lower with the banks as the March Fed meeting comes into focus.
What’s in Today’s Report:
Futures are little changed despite the Swiss National Bank providing Credit Suisse (CS) liquidity, as that news isn’t eliminating general market anxiety.
Credit Suisse is rallying more than 20% pre-open after it was granted a $54 billion credit line from the Swiss National Bank.
Despite the positive CS news, investors remain very nervous and jittery about U.S. regional banks (especially FRC).
Today is an important day as there are numerous potentially market moving events this morning, with the most important being the ECB Decision (E: 50 bps hike). Markets will want to see the ECB “blink” in the face of market turmoil and hike less than 50 bps. If the ECB sticks to a 50 bps hike, don’t be shocked to see more volatility today.
Economically, the hope that the Fed “blinks” and does not hike 25 bps next week has helped support stock and bond markets this week, so investors will want to see today’s economic data come in soft enough to make no hike more likely next week. Key reports today are, in order of importance: Philly Fed (E: -15.8), Jobless Claims (E: 205K), Housing Starts (E: 1.315M).