Morning Call For Thursday, Jan 11

OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH18 +0.18%) this morning are up +0.08% on strength in energy stocks and as the rout in Treasuries abated. Energy stocks gained as Feb WTI crude oil (CLG18 +0.63%) climbs +0.53% to a new 3-year high after Wednesday’s weekly EIA data showed U.S. crude inventories fell for an eighth week to a 2-1/3 year low. U.S. Treasury prices rose after China’s State Administration of Foreign Exchange said that a report saying officials reviewing the country’s foreign-exchange holdings have recommended slowing or halting purchases of U.S. Treasuries might have used a “wrong source.” European stocks are down -0.07%, led by losses in retail stocks, although the downside was contained after Eurozone Nov industrial production rose more than expected. Asian stocks settled mixed: Japan -0.33%, Hong Kong +0.15%, China +0.10%, Taiwan -0.19%, Australia -0.48%, Singapore -0.22%, South Korea -0.59%, India +0.20%. Japan’s Nikkei Stock Index retreated, led by losses in exporters, after USD/JPY tumbled to a 6-week low on Wednesday.

The dollar index (DXY00 +0.17%) is up +0.14%. EUR/USD (^EURUSD) is down -0.03%. USD/JPY (^USDJPY) is up +0.14%.

Mar 10-year T-note prices (ZNH18 +0.06%) are up +2.5 ticks.

The Japan Nov leading index CI rose +2.1 to a 3-3/4 year high of 108.6, right on expectations. The Nov coincident index rose +1.7 to a 10-year high of 118.1, stronger than expectations of +1.5 to 117.9.

Eurozone Nov industrial production rose +1.0% m/m, stronger than expectations of +0.8% m/m.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected -5,000 to 245,000, previous +3,000 to 250,000) and continuing claims (expected +6,000 to 1.920 million, previous -37,000 to 1.914 million), (2) Dec PPI final demand (expected +0.2% m/m and +3.0% y/y, Nov +0.4% m/m and +3.1% y/y) and Dec PPI ex food & energy (expected +0.2% m/m and +2.5% y/y, Nov +0.3% m/m and +2.4% y/y), (3) USDA weekly Export Sales, (4) Treasury auctions $12 billion 30-year T-bonds, (5) Dec monthly budget statement (expected -$26.5 billion, Nov -$138.5 billion), (6) New York Fed President William Dudley (voter) speaks on the U.S. economic outlook at a Securities Industry and Financial Markets Association event in New York.