Overnight and in to the open

Overnight we start with the Japanese Trade Balance which was a disaster in both import and exports, exports fell the most in over a year to levels seen around 2009. As a result, the JPY was crushed especially in the AUD/JPY carry trade pair, which is not good for the market. This alone was partially or largely to blame for S&P Futures falling overnight (ES). This has also, in a light macro news environment, caused most of European markets to fall in to the red. Spain's IBEX is down over 2%, the biggest drop in 3 weeks now, even with a short selling ban in effect. The Spanish Bond market is in worse shape, perhaps there's some reversion to the mean, if so, the IBEX would be due to lose another 7%.


Juncker's visit to Greece today should provide a lot of rumors and spin, many countries coming out in advance against softening of conditions for Greek aid as Greece falls way behind targets they are supposed to have achieved, mainly the Netherlands is speaking out today, but we saw Germany and others yesterday. Whether Greece asks for concessions today will be interesting and potentially market moving.


Much is being made this morning of New Jersey Unemployment which saw it's largest move since June of 2009, causing many analysts to wonder whether this is just NJ or a sign of things to come at the national level as NJ has long been considered Employment friendly.

As for the MBA Purchase Applications, a mixed bag.

Released On 8/22/2012 7:00:00 AM For wk8/17, 2012

Prior Actual Composite Index - W/W Change -4.5 % -7.4 % Purchase Index - W/W Change -2.0 % 0.9 % Refinance Index - W/W Change -5.0 % -9.0 % New applications picked up after running flat for the last several months, while refinancing saw a precipitous drop. The F_O_M_C minutes will be scrutinized over Housing. Just released (10 a.m.) Existing Home Sales may add some color... Released On 8/22/2012 10:00:00 AM For Jul, 2012 Prior Consensus Consensus Range Actual Existing Home Sales - Level - SAAR 4.37 M 4.500 M 4.300 M to 4.650 M 4.47 M Existing Home Sales - M/M Change -5.4 % 2.3 % Existing Home Sales - Yr/Yr Change 4.5 % 10.4 %

Existing home sales fell a surprising 5.4 percent in June to a 4.37 million annual rate which was the lowest of the year. Declines appeared for both single-family homes and condos and declines swept all regions. But prices were higher, at least the median for this series which is up a strong 5.0 percent from May for a year-on-year plus 7.9 percent. The median price, at $189,400, was the highest in 2 years. June's weak sales total raised supply on the market to 6.6 months at the current sales rate from 6.4 months.

We do have 2 key events today as mentioned, Juncker's trip to Athens and the F_O_M_C minutes released at 2 pm EDT. After Lockhardts very hawkish comments and stance against further F_E_D easing from yesterday, the F_O_M_C minutes will be key for many market participants.

Remember what I said yesterday about the pullback/bounce scenario in my "Gut Feeling" post, there may be some typical F_E_D knee jerk reactions at 2 pm as is almost always the case, be careful not to be too rash on the initial release.

Opening indications coming ....