Morning Call For Monday, February 12

OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH18 +1.20%) this morning are up +0.99% and European stocks are up +1.36% on relative calm in global financial markets. The dollar fell and the 10-year T-note yield rose to a new 4-year high of 2.89% on concern about rising U.S. budget deficits. President Trump will unveil his budget proposal today that will seek billions in new spending to improve a border wall, improve veteran’s health care and combat opioid abuse. The weaker dollar has boosted commodity prices with Mar WTI crude oil (CLH18 +1.62%) up +1.72%, which lifted energy stocks and boosted mining stocks with Mar COMEX copper (HGH18 +1.42%) up +1.35%. Asian stocks settled mostly higher: Japan closed for holiday, Hong Kong -0.16%, China +0.78%, Taiwan +0.48%, Australia -0.30%, Singapore +0.23%, South Korea +1.08%, India +0.87%. Chinese stocks closed higher, led by strength in financial stocks, on signs of strong credit growth after China Jan new yuan loans rose +2.9 trillion yuan, the most since record began in 1992.

The dollar index (DXY00 -0.21%) is down -0.24%. EUR/USD (^EURUSD) is up +0.10%. USD/JPY (^USDJPY) is down -0.12%.

Mar 10-year T-note prices (ZNH18 -0.39%)are down -12.5 ticks.

China Jan new yuan loans increased by a record 2.90 trillion yuan (data from 1992), stronger than expectations of 2.05 trillion yuan. Jan aggregate financing rose 3.06 trillion yuan, weaker than expectations of 3.15 trillion yuan, but still the largest increase in a year.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) USDA weekly grain export inspections, (2) Jan monthly budget statement (expected +$51.0 billion, Dec -$23.2 billion).

Notable S&P 500 earnings reports today include: Loews Corp (consensus $0.71), Vornado Realty Trust (0.77), FMC (1.05), Brighthouse Financial (2.12).

U.S. IPO’s scheduled to price today: none.

Equity conferences this week: Credit Suisse Energy Summit on Mon-Wed, Stifel Transportation and Logistics Conference on Tue, Credit Suisse Financial Services Forum on Tue-Wed, Goldman Sachs Technology and Internet Conference on Tue-Thu, ACI European Biopolymer Summit on Wed, Capital Link Cyprus Shipping Forum on Wed, Bank of America Merrill Lynch Insurance Conference on Wed-Thu, LEERINK Partners Global Healthcare Conference on Wed-Thu.