Evening Headlines
Bloomberg:
- Productivity Primed to Pick Up in U.S. and Europe, McKinsey Says. The era of anemic productivity growth may be coming to an end in the U.S. and Europe. So says the research arm of consultation company McKinsey & Co. in a new 147-page report. It argues that productivity could expand at a 2 percent-plus annual clip over the coming decade versus the roughly 0.5 percent pace in recent years. “We are very optimistic” about the potential for achieving significant gains, Jaana Remes, a partner at McKinsey Global Institute in San Francisco, said in an interview.
- Asia Stocks to Drop; Dollar Gains as Yields Rise. Asian stock futures indicate a lower open after U.S. equities snapped a six-day rally on a disappointing result from Walmart Inc. and as Treasuries fell amid massive debt issuance. The dollar advanced. Futures on equity indexes in Japan declined and Australia’s benchmark inched lower at the open. The S&P 500 Index slipped below its average price for the past 50 days. Walmart sank the most since 1988. The U.S. Treasury on Tuesday sold $179 billion of securities, with yields on two-year notes and three- and six-month bills climbing to levels unseen since 2008. Futures on Japan’s Nikkei 225 Stock Average dropped 0.4 percent in Singapore. Australia’s S&P/200 Index dropped 0.1 percent. Futures on the S&P 500 rose less than 0.1 percent as of 8:24 a.m. in Tokyo. The underlying measure fell 0.6 percent. The MSCI Emerging Market Index declined 0.5 percent, the biggest drop in more than a week.
- Inflation's Come and That's Good for Commodities, JPMorgan Says. Inflation’s back and raw materials stand to benefit, according to JPMorgan Chase & Co., which has raised forecasts for metals. “Inflation has come and it should be good for commodities,” the bank said in a report received on Wednesday. Among signs of the shift, JPMorgan cited stronger U.S. wage numbers as well as recent core consumer price inflation.
- Market's Red Line for Yields Isn't Where Everyone Thinks It Is. (video) Among the myriad theories for the violent correction in equities two weeks ago, one of the most prominent was a spike in Treasury yields toward the dreaded 3 percent level. It’s wrong, according to Jonathan Golub, chief U.S. equity strategist at Credit Suisse AG. At least that’s the case when the 10-year rate is below what he calls the neutral level of 3.5 percent, Golub wrote in a note to clients Tuesday. The last time the 10-year yield topped that was in 2011.
- OPEC Roars Into 2018 Oil Cuts. Allies Stumble, Shale Soars.
Wall Street Journal:
- Russian Trolls Tweeted Disinformation Long Before U.S. Election. Tweets about contaminated water, tainted turkey look to security experts like practice for the political season.
CNBC:
Zero Hedge:
Business Insider:
Night Trading
Earnings of Note
Company/Estimate
Night Trading
- Asian equity indices are +.25% to +1.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 69.50 +1.25 basis points.
- Asia Pacific Sovereign CDS Index 12.5 +.25 basis point.
- Bloomberg Emerging Markets Currency Index 75.59 +.02%.
- FTSE 100 futures -.09%.
- S&P 500 futures +.21%.
- NASDAQ 100 futures +.24%.
Earnings of Note
Company/Estimate
- (AAP)/.65
- (BLUE)/-1.73
- (DISH)/.55
- (GRMN)/.76
- (OC)/1.04
- (UTHR)/4.56
- (WEX)/1.46
- (WWW)/.41
- (AAOI)/.83
- (CAR)/.22
- (CAKE)/.53
- (CTRP)/.16
- (JACK)/1.11
- (NE)/-.33
- (RMAX)/.50
- (STMP)/2.78
- (SRCL)/1.14
- (RGR)/.77
- (SNPS)/1.00
- (UCTT)/.60
- (VMI)/1.69
- (WEN)/.11
9:45 am EST
- The Preliminary Markit US Manufacturing PMI for February is estimated at 55.5 versus 55.5 in January.
- The Preliminary Markit US Services PMI for February is estimated to rise to 53.7 versus 53.3 in January.
- Existing Home Sales for January are estimated to rise to 5.6M versus 5.57M in December.
- Jan. 31 FOMC meeting minutes.
- None of note
Other Potential Market Movers
- The Fed's Kashkari speaking, UK Unemployment Rate, Eurozone Services PMI report, $35B 5Y T-Note auction, weekly MBA Mortgage Applications report, weekly US retail sales reports, Barclays Industrial Conference, RBC Healthcare Conference and the Citi Industrials Conference could also impact trading today.
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