Morning Note October 10, 2016

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Monday, October 10, 2016

 

SPX Up, Dollar Up, Crude Up

The second US Presidential debate kicked off last night in a fiery session of character assassination between Clinton and Trump. It’s hard to tell who won the debate due to the bond market holiday. Drudge Report polled +600k giving Trump the win 56% vs. Clinton 44%

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Morning Note October 7, 2016

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Friday, October 07, 2016

 

SPX Down, Dollar Up, Crude Flat

Global markets are slightly under pressure in the overnight ahead of the US NFP data. Three themes in play today include the GBP/USD flash crash shifting forex flows, NFP data, and the sell off in US treasuries. The consensus on today’s NFP data is 171k. The survey range is 125k- 220k. Below is NFP overlaid with US productivity. Our focus is the overall trend of NFP not so much the individual prints. NFP has been deteriorating since 2010 in a negative slope now testing the lower range of the channel. US productivity slips for the first time in three decades, which makes us question how productive are these NFP jobs?

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Morning Note October 6, 2016

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Thursday, October 06, 2016

 

SPX Down, Dollar Up, Crude Flat

This is the fourth session US markets are range bound primarily due to low volatility and the weeklong China holiday. There is weakness is the DAX and FTSE100 following DB’s discrete talks with Germany, ECB Taper Rumor, and fears of Article 50 triggering. Oil gained ground prior session on EIA inventory draw and is now flat on the session following Algeria’s oil minister who said that OPEC could cut 1% more than agreed upon. Much resistance sits at 50 handle with US Shale itching to come back online as well as forex flows of a strengthening dollar.

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Morning Note October 5, 2016

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Wednesday, October 05, 2016

SPX Flat, Dollar Flat, Crude Up

Market activity continues to be subdued in the overnight session with China on a weeklong holiday. Americans watched the Vice President debate. CNN Polling data includes Pence succeeds in Debate 48% of voters who watched said Pence won debate, 42% said Kaine won.

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Morning Note October 4, 2016

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Tuesday, October 4, 2016

SPX Down, Dollar Up, Crude Down

Market activity overnight has been relatively quiet. China is off all week and the German’s banking holiday ended prior session. Early morning, the main event has been forex flows in relation to Article 50 timing. The Sterling GBP/USD has plummeted to 30 year lows with a DXY + 51bps on the session.

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Morning Note October 3, 2016

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Monday, October 3, 2016

 

SPX Flat, Dollar Up, Crude Up

Global stocks are flat with banking holidays in Germany, China and South Korea. Weekend topics include Deutsche Bank, return of China volatility, Saudi 9/11 bill, EU Dollar shortage, EU Financials, US/Russia in Syria, and the US elections. It’s worth noting, todays US event calendar:

  • Wards Total Vehicle Sales, Sept., est. 17.45m (prior 16.91m)
  • 9:45am: Markit US Manufacturing PMI, Sept. F, est. 51.4 (prior 51.4)
  • 10am: Genscape Inventory data
  • 10am: Construction Spending m/m, Aug., est. 0.3% (prior 0%)
  • 10am: ISM Manufacturing, Sept., est. 50.3 (prior 49.4)
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Morning Note September 30, 2016

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Friday, Sept 30, 16

SPX Down, Dollar Up, Crude Down

Global stocks are under-pressure driven by the speculation of Deutsche Bank Viability. For three years the market has been well aware of the $72.8 Trillion derivatives book deemed the riskiest in the world. Watching the equity drop from $50 in 2014 to $11 in 2016. There has been a-lot happening on the surface as the mainstream media promises Deutsche Bank is in a vacuum. Well, that was not the case yesterday when DB’s bank run was announced as hedge funds withdraw excess liquidity in droves. The headlines crashed the stock -900bps and sent shock waves to all global markets. The difference between Lehman and Deutsche is Lehman did not have retail depositors and wasn’t subjected to a bank run. DB does and we’re seeing smart money go public about it. John Cryan CEO of DB is replicating a “Lehman moment” via Richard Fuld assuring the market everything is calm.

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Morning Note September 29, 2016

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Thursday, Sept 29, 16

 

SPX Flat, Dollar Up, Crude Down

Prior session, OPEC announced a “preliminary deal” of production cuts without providing any actual details of who would cut. The proposal in OPEC terms was “informal” and won’t be decided on until Vienna, which is two months away.

Russia is excluded from the deal who as of yesterday smashes post Soviet oil supply record. Quite comically, after the informal meeting Iraq headlines: OIL MIN REJECTS OPEC SECONDARY-SOURCES OIL OUTPUT ESTIMATE.

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Morning Note September 28, 2016

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Wed, Sept 28, 16

SPX Flat, Dollar Up, Crude Up

Overnight US future equity indexes are flat with risk on sentiment in Europe. Deutsche Bank CEO tries to calm the markets telling global investors everything is “fine”. Weakness developed in Asia and especially in Japan with the Nikkei down -130bps. US events calendar has durable goods at 8:30am and 10:30am EIA Inventories. Beyond regular events, Yellen will appear before a Congressional committee then shortly after 4 Fed Speakers will commence throughout the day. The excessive nature of the FED to convince participants their system works shows true colors of desperation. Algiers meeting will wrap up today with a non-event expected.

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Morning Note September 27, 2016

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Tuesday, Sept 27, 16

 

SPX Up, Dollar Up, Crude Down

Topic of the morning is last night’s most watched television debate in history between Clinton and Trump. Post data polling by CNN indicates Clinton was the winner using a population of 521. On the contrary, Drudgereport.com post polling data indicates Trump was the winner using a population of +360,000. Nevertheless, the most comical point was Trump calling out a “political Federal Reserve”, as well as US economy “in a big fat ugly bubble”. Moments later, Wall Street decides to call the winner by pushing risk assets higher calling it the Hillary Rally. In the 7am hour, the rally has fizzled after news that the DOJ is assessing the size of the criminal fine it can extract from Volkswagen over the emission scandal. Deutsche Bank hits a new all time low to the mid-11 handle as CDS rising to new all time highs following statements from Merkel prior session of no government bailout of the financial institution. In the commodity space, WTI is -123bps following comments from Iran’s oil minister Zanganeh that Algiers meeting a freeze is “not our agenda”.

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