(6:00 AM) S&P futures (+2.40 vs Fair Value -0.86). The range is +3 to -1. Asia saw Japan trade in a narrow 0.5% range with the low 1.5 hours in and a close just above the open with no real trading opportunities. Singapore had just over a 0.3% range with the high 1 hour in and the low 2 hours in and then managing to get back close to the morning high by the close. Hong Kong’s low was 30 minutes in and finished 1% higher but most of the gains came before lunch. India trended up by 0.9% until around 1PM but flattens out with european markets. Germany and the UK opened strong and haven’t done much since with the UK PPI again coming in stronger than expected which seems to happen with every report but this was quite a bit stronger. With little in the way of trading opportunities today, the focus may be more on the Masters. The Arms measures remain overbought but not at the extreme they were. Short-term advance/declines are neutral. 10-day volume YOY continues to rise but with little affect on stock prices so far.
US Treasury Market Review
U.S. Treasuries saw the 10-year yield finished up 3 basis point at 3.89%. The 30-yr auction Closes At 4.77% compared with exp. 4.768%; Bid To Cover of 2.73 vs 2.66 Average, 2.89 previously; Indirects take down 36.80% vs 37.08% Average, 23.85% previously; Direct take down 25.48% vs record 29.65% previously, more than double the 11.24% average; Alotted at high 30.96%; Primary dealer hit rate: 22.7%, Directs Take Down Massive.
Commodities Review
Crude Oil settled -$0.49 at $85.39/brl.
GOLD settled -$0.10 to $1,152.90/oz. Trader Vic says the reason the old rules aren’t working for gold is this is a different kind of inflation driven by a credit bust that is all currency related. Normally, gold would have gone down to $600-660 as Bob Prechter predicted as the lagging economic indicators went negative. It just hasn’t happened. The worry is when lagging economic indicators again show positive growth rates. Where does gold go then? Will it match the price of the Dow as in 1980? Previous economic cycles suggest it gets interesting in 2011-12. Bernanke is a historian in policy but economic cycles and the history of economic thought are two other professions. Nobody has time to master everything.
Reuters/Jefferies CRB Futures Price Index -2.34 to 275.25. To view chart: (http://quotes.ino.com/chart/index.html?s=NYBOT_CR&t=&a=&w=&v=d12). The monthly crop report is this this morning, Apr 9th. While traders are hoping for the euro to gain some seasonal support in May, the euro is toast if we have anything similar to 2004 but could bottom out around June. Generally, commodities do better amid euro strength maybe because is supports stronger oil prices. In gold terms, the euro was pretty flat the first half of the decade but has been getting hammered since 2005, so this may be why europeans are always talking about gold. Gold is up well over double since 2005 in euros despite all the talk of euro strength at the end of 2009.
International Review
* Tokyo Nikkei 225 (+36.14 / +0.32%)
* Hong Kong Hang Seng (+341.46 / +1.56%)
* Australia S&P/ASX 200 (+10.20 / +0.21%)
(6:00 AM)
* UK FTSE 100 (+54.18 / +0.95%)
* France CAC 40 (+50.04 / +1.26%)
* Germany DAX (+56.60 / +0.92%)
FOREX
Euro and Pound soar buoyed by stock markets.
AUD/USD jumps to 0.9300.
USD/JPY on recovery, session high 93.70.
EUR/USD bounces at 1.3340 to test session high at 1.3410.
GBP/USD rebound reaches 1.5360.
Geithner leaves Beijing, no major comments forthcoming.
USD/CAD declines back to 1.0000, so commodity currencies are both up (we haven’t checked Indonesia).
China Won’t Go for `Big Bang’ Yuan Appreciation, Hong Kong’s Arculli Says.
(6:00 AM)
* Dollar / Yen (+0.35 to 93.73)
* Euro / Dollar (+0.0038 to 1.3398)
