As for futures pre-market...
ES looks set for an early pop, but then...
The 5 min chart looks like a sharp drop is right on the cusp.
NQ is in line with the overnight losses and looks to retain that stance...
As well as the 5 min drop, in fact all Index futures have this sharp 5 min negative.
And TF looks like it will maybe see a little pop on the open, and likely a drop after.
This morning I'm a little baffled that on such a light volume day / night that the Index futures look the way they do, not horrible, but not good, certainly not EU hints of QE overnight for what? A third or fourth consecutive day (including the weekend)? Again we have the ECB's Constanacio pushing at the QE heart strings of the world with an overnight speech in London hinting at the possibility that the ECB will "consider buying other assets, including sovereign bonds in the secondary market," if the pace of balance sheet expansion is not in line with expectations, which would be what exactly as rumors and hints night after night are pretty far from quantitative or qualitative guidance, they are plausible deniability while trying to reap the benefits or a lower Euro which hasn't been working so well the tis week.
Perhaps this is why the ECB is out there every day talking up the chances or "possibilities" of IMMINENT QE. The Euro has gained enough to send the dollar lower the last two days. This is after all what Draghi does...maybe not best, but what he does, jawbone the Euro lower.
Perhaps that's why the ECB has resorted to Constancio as the market is tired of Draghi's incessant hints and no action? He further added, "In particular, during the first quarter of next year we will be able to gauge better” the impact of current stimulus. Further asset purchases “would be a pure monetary policy decision, buying accordingly to our capital key, within our mandate and our legal competence."
Two problems, one for UBS who says ECB QE starts in December, that seems to have just been blown out of the water with the statement in bold and "within the legal mandate" is the other problem, the ECB is forbidden to finance any country's debt, look up their mandate, specifically article 123 and read Germany's and the Bundesbank's views on the subject as Germany's opinion is the only one that matters, Goldman doesn't have a foothold there yet.
So Constancio tells us more about the possible channels for QE including: “signaling and influencing inflation expectations, exploring spill-overs resulting from investors using the cash received to buy other assets, including foreign assets with influence on the exchange rate,” and “increasing credit to the real economy.”
Speaking of GERMANY, overnight Germany SELLS 10-YEAR BUNDS AT RECORD-LOW YIELD OF 0.74%! However nearly 18% of the auction was uncovered leaving the Bundesbank to retain that portion. Interesting.
As to OPEC meeting announcement tomorrow, fireworks...
Russia yesterday failed to agree on a production cut, when Saudi Arabian Oil Minister Ali Al-Naimi tells reporters in Vienna, before tomorrow's OPEC meeting that "No one should cut and mkt will stabilize itself." What's worse, the Saudi turned the tables on the US itself: “Why Saudi Arabia should cut? The U.S. is a big producer too now. Should they cut?"
No comments:
Post a Comment