OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH16 -1.65%) are down -1.54% and European stocks are down -1.26% at a 13-month low as crude oil is down sharply by -4.90%at a fresh 12-year low. Energy and commodity producers are leading the overall market lower as the slide in crude oil and commodity prices intensifies. Also, Intel is down over 5% in pre-market trading after its Q1 sales forecast fell short of expectations, and Volkswagen AG is down almost 3% in European trading after data from the European Automobile Manufacturers’ Association showed its market share in Europe last year fell for the first time since 2007. A -3.55% plunge in China’s Shanghai Composite is another negative for global equity markets lower after a report that some banks in Shanghai have halted accepting shares of smaller listed companies as collateral for loans. Asian stocks settled mostly lower: Japan -0.54%, Hong Kong-1.50%, China -3.55%, Taiwan +0.25%, Australia -0.34%, Singapore -0.52%, South Korea -1.12%, India -1.28%.
The dollar index (DXY00 -0.17%) is down -0.18%. EUR/USD (^EURUSD) is up +0.35%. USD/JPY (^USDJPY) is down -0.57%.
Mar T-note prices (ZNH16 +0.45%) are up +14.5 ticks at a 2-1/2 month high on weak oil prices and the plunge in global equity markets.
According to a statement on China’s central government website, Chinese Premier Li Keqiang said China doesn’t seek to boost exports via yuan devaluation. He reiterated that there is no basis for continuous yuan depreciation and that China can keep the yuan exchange rate basically stable at an equilibrium level.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Dec retail sales (expected -0.1% and +0.2% ex autos, Nov +0.2% and +0.4% ex autos), (2) Dec PPI final demand (expected -0.2% m/m and -1.0% y/y, Nov +0.3% m/m and -1.1% y/y) and Dec PPI ex food & energy (expected +0.1% m/m and +0.3% y/y, Nov +0.3% m/m and +0.5% y/y), (3) Jan Empire manufacturing survey of general business conditions (expected +0.59 to -4.00, Dec +6.15 to -4.59), (4) New York Fed President William Dudley’s speech on the economy and monetary policy at the Economic Leadership Forum in Somerset, New Jersey, (5) Dec industrial production (expected -0.2%, Nov -0.6%), (6) Nov business inventories expected (-0.1% m/m, Oct unch m/m), (7) preliminary-Jan University of Michigan U.S. consumer sentiment (expected unch at 92.6, Dec +1.3 to 92.6), (8) San Francisco Fed President John Williams delivers opening remarks and takes audience questions at The Bay Area Council Economic Institute Annual Forecast Conference, and (9) Dallas Fed President Rob Kaplan’s participation in a moderated panel discussion in Dallas.
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