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News & Views: Thursday, August 7
What you need to know for today's trading day.
Michael Sedacca    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

Putin Hits Tipping Point as Ukraine Tightens Rebel Noose (Bloomberg)

Bank of England holds steady as rates debate heats up (Reuters)

Russia Bans Array of U.S., EU Foods in Retaliation Move (Bloomberg)

Deutsche Telekom Rejects Iliad Bid, Leaves Door Open to US Sale (NYTimes)

BofA Said Nearing Up to $17 Billion Mortgage Settlement (Bloomberg)

Views
One of the main stories overnight was the surprise spike in Australian unemployment. For July, the unemployment rate rose to 6.4% from 6.0% in the previous month. However, judging by the information at hand, there is no discernable reason to explain the jump. The participation rate only increased by one tenth and the net employment change for the month was -300 (that's hundred). Irregardless, the AUD is showing the largest negative return in currencies overnight and did not make any move to recover. The RBA has been in a neutral stance for the past nine months and the clear reaction is to move more dovish. Its monetary policy report is due late tonight.

The Bank of England kept rates on hold at 0.5% for another month. No mention was made in the statement about any dissent, so we will have to wait until the minutes are released in two weeks to see what push was made to hike rates. The main story today is what Draghi says at the ECB press conference, scheduled to start at 8:30am ET. There have been no media leaks that indicate he will make any large changes to the current policy stance. The one potential comment could be on the ABS program, which Germany's financial ministry has spoken negatively about.

German Bunds continue to rally, the 2yr Schatz yield dropped below zero again this morning due to the country's industrial production growth coming on the light side in June. It's been at least a year since we reached that level. For perspective, the Swiss 10yr is 0.49% versus the 1.08% Bund, so dropping below 1% is not out of the realm of possibilities. This is keeping a bid behind US Treasuries this morning, where, if you can believe it, realized and implied volatility on swaptions remains near the record low level set in May 2013.

Russia officially announced overnight that it was banning food imports from most Western countries. The foods included all cheese, fish, beef, pork, fruit, vegetables, and dairy products, and applies for all countries that have imposed sanctions against Russia. Keep an eye on the dry bulk shippers, and by extension the Baltic Dry Index, as this would directly impact them.

Overnight Data:
- Australian unemployment rate (July) up to 6.4% vs 6.0% expected, prior 6.0%
-- Employment change -0.3K vs 13.2K exp, prior 14.9K
- Eurozone industrial production MoM (June) up 0.3% vs 1.2% exp, prior -1.7%

US Economics (Time Zone: EST)

08:30 Initial Jobless Claims - 289K, exp. 304k, prior 302k
08:30 Continuing Claims - 2518K, exp 2512K, prior 2539k
3:00 Consumer Credit (June) - exp $18.65B, prior $19.62B
11:00 Fed to purchase $2.05b-$2.5b notes in 7 to 10-year range

Earnings

Before:
Cooper Tire (CTB)
Goodrich Petroleum (GDP)
Wendy's (WEN)
Duke Energy (DUKW)

After:
Nvidia (NVDA)
Monster Beverages (MNST)
CBS (CBS)
Lions Gate (LGF)
Medivation (MDVN)
Zynga (ZNGA)
Solarcity (SCTY)

Linn Energy (LINE)

Twitter: @MichaelSedacca

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

More From Michael Sedacca
News & Views: Thursday, August 7
What you need to know for today's trading day.
Michael Sedacca    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

Putin Hits Tipping Point as Ukraine Tightens Rebel Noose (Bloomberg)

Bank of England holds steady as rates debate heats up (Reuters)

Russia Bans Array of U.S., EU Foods in Retaliation Move (Bloomberg)

Deutsche Telekom Rejects Iliad Bid, Leaves Door Open to US Sale (NYTimes)

BofA Said Nearing Up to $17 Billion Mortgage Settlement (Bloomberg)

Views
One of the main stories overnight was the surprise spike in Australian unemployment. For July, the unemployment rate rose to 6.4% from 6.0% in the previous month. However, judging by the information at hand, there is no discernable reason to explain the jump. The participation rate only increased by one tenth and the net employment change for the month was -300 (that's hundred). Irregardless, the AUD is showing the largest negative return in currencies overnight and did not make any move to recover. The RBA has been in a neutral stance for the past nine months and the clear reaction is to move more dovish. Its monetary policy report is due late tonight.

The Bank of England kept rates on hold at 0.5% for another month. No mention was made in the statement about any dissent, so we will have to wait until the minutes are released in two weeks to see what push was made to hike rates. The main story today is what Draghi says at the ECB press conference, scheduled to start at 8:30am ET. There have been no media leaks that indicate he will make any large changes to the current policy stance. The one potential comment could be on the ABS program, which Germany's financial ministry has spoken negatively about.

German Bunds continue to rally, the 2yr Schatz yield dropped below zero again this morning due to the country's industrial production growth coming on the light side in June. It's been at least a year since we reached that level. For perspective, the Swiss 10yr is 0.49% versus the 1.08% Bund, so dropping below 1% is not out of the realm of possibilities. This is keeping a bid behind US Treasuries this morning, where, if you can believe it, realized and implied volatility on swaptions remains near the record low level set in May 2013.

Russia officially announced overnight that it was banning food imports from most Western countries. The foods included all cheese, fish, beef, pork, fruit, vegetables, and dairy products, and applies for all countries that have imposed sanctions against Russia. Keep an eye on the dry bulk shippers, and by extension the Baltic Dry Index, as this would directly impact them.

Overnight Data:
- Australian unemployment rate (July) up to 6.4% vs 6.0% expected, prior 6.0%
-- Employment change -0.3K vs 13.2K exp, prior 14.9K
- Eurozone industrial production MoM (June) up 0.3% vs 1.2% exp, prior -1.7%

US Economics (Time Zone: EST)

08:30 Initial Jobless Claims - 289K, exp. 304k, prior 302k
08:30 Continuing Claims - 2518K, exp 2512K, prior 2539k
3:00 Consumer Credit (June) - exp $18.65B, prior $19.62B
11:00 Fed to purchase $2.05b-$2.5b notes in 7 to 10-year range

Earnings

Before:
Cooper Tire (CTB)
Goodrich Petroleum (GDP)
Wendy's (WEN)
Duke Energy (DUKW)

After:
Nvidia (NVDA)
Monster Beverages (MNST)
CBS (CBS)
Lions Gate (LGF)
Medivation (MDVN)
Zynga (ZNGA)
Solarcity (SCTY)

Linn Energy (LINE)

Twitter: @MichaelSedacca

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

More From Michael Sedacca
News & Views: Thursday, August 7
What you need to know for today's trading day.
Michael Sedacca    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

Putin Hits Tipping Point as Ukraine Tightens Rebel Noose (Bloomberg)

Bank of England holds steady as rates debate heats up (Reuters)

Russia Bans Array of U.S., EU Foods in Retaliation Move (Bloomberg)

Deutsche Telekom Rejects Iliad Bid, Leaves Door Open to US Sale (NYTimes)

BofA Said Nearing Up to $17 Billion Mortgage Settlement (Bloomberg)

Views
One of the main stories overnight was the surprise spike in Australian unemployment. For July, the unemployment rate rose to 6.4% from 6.0% in the previous month. However, judging by the information at hand, there is no discernable reason to explain the jump. The participation rate only increased by one tenth and the net employment change for the month was -300 (that's hundred). Irregardless, the AUD is showing the largest negative return in currencies overnight and did not make any move to recover. The RBA has been in a neutral stance for the past nine months and the clear reaction is to move more dovish. Its monetary policy report is due late tonight.

The Bank of England kept rates on hold at 0.5% for another month. No mention was made in the statement about any dissent, so we will have to wait until the minutes are released in two weeks to see what push was made to hike rates. The main story today is what Draghi says at the ECB press conference, scheduled to start at 8:30am ET. There have been no media leaks that indicate he will make any large changes to the current policy stance. The one potential comment could be on the ABS program, which Germany's financial ministry has spoken negatively about.

German Bunds continue to rally, the 2yr Schatz yield dropped below zero again this morning due to the country's industrial production growth coming on the light side in June. It's been at least a year since we reached that level. For perspective, the Swiss 10yr is 0.49% versus the 1.08% Bund, so dropping below 1% is not out of the realm of possibilities. This is keeping a bid behind US Treasuries this morning, where, if you can believe it, realized and implied volatility on swaptions remains near the record low level set in May 2013.

Russia officially announced overnight that it was banning food imports from most Western countries. The foods included all cheese, fish, beef, pork, fruit, vegetables, and dairy products, and applies for all countries that have imposed sanctions against Russia. Keep an eye on the dry bulk shippers, and by extension the Baltic Dry Index, as this would directly impact them.

Overnight Data:
- Australian unemployment rate (July) up to 6.4% vs 6.0% expected, prior 6.0%
-- Employment change -0.3K vs 13.2K exp, prior 14.9K
- Eurozone industrial production MoM (June) up 0.3% vs 1.2% exp, prior -1.7%

US Economics (Time Zone: EST)

08:30 Initial Jobless Claims - 289K, exp. 304k, prior 302k
08:30 Continuing Claims - 2518K, exp 2512K, prior 2539k
3:00 Consumer Credit (June) - exp $18.65B, prior $19.62B
11:00 Fed to purchase $2.05b-$2.5b notes in 7 to 10-year range

Earnings

Before:
Cooper Tire (CTB)
Goodrich Petroleum (GDP)
Wendy's (WEN)
Duke Energy (DUKW)

After:
Nvidia (NVDA)
Monster Beverages (MNST)
CBS (CBS)
Lions Gate (LGF)
Medivation (MDVN)
Zynga (ZNGA)
Solarcity (SCTY)

Linn Energy (LINE)

Twitter: @MichaelSedacca

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

More From Michael Sedacca
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