March 27, 2017 Big Ugly Day Coming

March 27th, 2017

In the first hour of the Europe Session we are down about 1%. Asia was down, Copper is down. Shanghai Futures had copper and the other metals down. Gold and Silver up. Merkel did very good in her election. BoJ was out trying to talk down the Yen again, but it isn’t stopping the run into the Yen over 1%. Swiss hasn’t stepped in for Intervention yet. Press is blaming the failure to pass healthcare bill, but IMHO this is all still a China Slowing story of course even though Shanghai .08% .Chinese central bank governor Zhou Xiaochuan was out this weekend warning about the ending of global QE. Russia had protest rallies this weekend regarding the Corruption in the Russian Govt., One Official they claimed to have “raised” One Billion dollars. Many were arrested. Oil is sliding too  down .77% even with talk from OPEC.

March 2017

March 24, 2017 Give it your best shot Bulls, us Bears Dare you

March 24th, 2017

Just before the start of the European Trade we are up .20% which is a bit down from the Asia session. Nobody really knows if the House has the Votes, but that isn’t stopping the bulls overnight. Shanghai futures had all the metals down except for copper which was up a small bit. Kuroda was out talking down the Yen with promises of not taking away any stimulus, but of course he has to say that for the rest of his career because of the HUGE holding of bonds the BoJ are holding. USD/JPY up .32% which isn’t that much. Japan’s FLASH PMI came in a bit weaker vs last month. Oil is trying to push up .40% . This weekend there will be a German small election that will be the first test of Merkel’s re election. At this point there is no clear votes needed. Big test for the bulls today..


March 23,2017 Bulls have to be Strong Today, Obamacare Repeal Bill Vote

March 23rd, 2017

In the first hour of the europe session we have a flat market. Oil is up .33%. Today the Health Care Vote will take place in the house of reps. At the moment it is still close to call. Shanghai Futures were rather flat today after yesterdays big sell off. Gossip around China is that the controls put in this month are slowing Property Buying. The China Auto Makers have been decreasing sales also. Iron Ore continues to slide. Yellen will be speaking. Prime Minister May will be addressing Parliament about the attack. Today the Bulls have to have a strong day even if the Health Bill fails, if not us Bears will be very happy cuz China is slowing, Central Banks are backing away (btw UK retail sales beat big..another reason for BoE to move on rates), commodities in a glut…we shouldn’t be at these levels..yet, Bulls have been taught to buy the dip/bad news for 7 years..let’s see if they will perform their same old trick?

March 2017

March 22, 2017 UK’s FCA and NCA will investigate THE GLOBAL LAUNDROMAT

March 22nd, 2017

This is a story that is getting no coverage in Asia or in many normal places but it would explain the sell off. There was an Article written in the UK Telegraph (based off research by the  Organized Crime and Corruption Reporting Project) about a huge Money Laundry system coming from Russia but involving a lot of global and UK banks and possible govt officials? Yesterday the News Article and the original research was brought as a urgent parliamentary question. After Labor Critized Simon Kirby, the ‘City’ minister responsible for financial services for not acting aggressive in this, Kirby said in parliament on Tuesday that “The Financial Conduct Authority (FCA) and the National Crime Agency (NCA) … will investigate closely whether recent information from the Guardian newspaper regarding money laundering from Russia, or indeed any other media source, would allow the progression of an investigation,”. IMHO many parties that could have questionable accounts might take this opportunity to protect their interest, which could result in a drop of liquidity around the world. For tonight, Futures are down .28%. Shanghai Futures all down big except for Gold and Silver. Oil down after API.

March 2017

March 21, 2017 Carney talks, does anyone care?

March 21st, 2017

Tonight we had the RBA minutes come out showing that Australia won’t be so quick to raise in the near future. Added to that, Shanghai Copper Futures were down pretty nice. In the first hour of the Europe Session we are up .20% going into a speech from Carney out of the BoE. Remember how he was all Doom and Gloom when Brexit passed. Now he is dealing with better econ data. The US session has a couple of Fed Heads talking. But, nothing of interest. Zzzzzzzzzzzzzz

March 2017

March 20, 2017 So Far in March, 18 Major Cities in China have added controls in home buying

March 20th, 2017

Futures have been on the flat side for most of the night. Fourth Hour of the europe session and they are still flat. Oil is having a rough night with it dropping over 1.30% . There are rumors that the BHP Copper strike workers might be talking, copper is tad weaker even with a confirmation that China House Sales in Feb were higher. So far for March, Shanghai had a bit of a move up last week. That Move was without much commitment. Shanghai Copper futures flat. The G20 drops the anti protectionist pledge (which some say is causing the sell off in oil, fwiw). Gossip was the USA vs everybody else there. Europe Markets are down .20%. Reuters is reporting that China Govt will be trying to  introduced new restrictions for financial institutions seeking to outsource fund management to external fund managers..this in a way to slow down funds going into shadow banking. Trivia, on March 24 Russia’s Central Bank Meets and should cut rates .25%

March 2017

March 17,2017 All the central banks are done, G 20 gossip swirls..the witch goes after the Animals

March 17th, 2017

Here is the Central Bank Breakdown that we have seen this month…

  1. BoJ well with  the Japanese central bank balance sheet is close to the size of Japan’s total GDP, Kuroda did nothing but just hold the line pressing the bet on remaining accomative.  BoJ reaffirmed its guideline yield of “around zero percent” on the 10-year bond. This would be maintained by further purchases of bonds “as long as is necessary” to produce a rate of inflation that “exceeds 2 percent and stays above the target in a stable manner”
  2. FOMC raised .25% but Fed futures didn’t change much. Chances of four hikes was 24.7% and is now 20.4%. All data dependent. dxy 100.20 right now.
  3. ECB after the meeting of no action we get an interview of Draghi’s boy Nowotny indicating that The European Central Bank will decide at a later time whether to raise interest rates before or after ending its bond purchase program. Over this comment the chance of a rate hike in Dec 2017 jumped 60%. It appears ECB will start to move towards raising. Eur/USD should start to get some love.
  4. BoE left rates the same but actually had a member vote to raise .25. Too bad she is going to leave soon. But there are a few members that are just a few steps behind her. The Brexit fear mode seems to be lessening. Now there is a 100% chance of a rate hike by sept 2018
  5. Swiss remained in the same negative interest rates stance hoping that there won’t be flee for safety into the Swissy. Switzerland’s foreign currency reserves continue to grow and now total close to the equivalent of $670 billion, equivalent to the country’s GDP…20% of that is all those stocks they have been buying. Pushing the bet just like Japan.
  6. China PBOC they raised rates for overnight SLF loans will be raised by 20 basis points (bps) to 3.30 percent. It wasn’t a Interest Rate hike per se, but more are expected,  and will eventually translate into higher borrowing costs for Chinese companies and consumers.
  7. RBA is almost at the point that they won’t ever raise rates again. Normally they follow the Fed, but Futures  showed investors were seeing just a 24 per cent chance of a rate hike by the end of the year, sharply lower from the roughly 50-50 probability priced in last week in the wake of the RBA’s March meeting.

So we have China, BoE, ECB and FOMC on a greater chance of being less dovey and slowing down the gravy train. BoJ, SNB and RBA have no choice but to remain the mega doves. But no one is ADDING additional stimulus.

For the G 20 meeting, Trade and Protectionism is the biggies. Many are pushing words to denounce Protectionism. USA is against that statement, US wants Fair Trade wording. Tonight China dropped over 1% over the rate hike with Materials selling off.  Our futures are are about flat in the second hour of the europe trade including oil. But today is QUAD witching, lots and lots of bets on our Saint Patrick’s Day. Strap on, it could get wild today.

March 2017

March 15, 2017 Oil pops over a drawdown on API, Animal Spirits want to dance at Fed Party

March 15th, 2017

Oil is up 1.91% in the second hour of europe trade after the API showed a draw down vs a expected build. API is about 60% of the time inline with EIA numbers which we get today. Futures AND Gold are up around .22% for Futures and .32% for Gold. The China Meetings were over on Sunday but they had One final closing speaker Premier Li closed the congress, he said  “I should say that the growth target of around 6.5-percent is not a low speed and it will not be easy to meet.” Shanghai futures were a bit up, nothing big. This weekend is the G20 meeting, it might be a bit more then the Photo Op when China gets to hang out with our new Treasury Guy Steve M.. China Steel/Ore pushed up today with the fears that CHina will cut production levels based on air pollution. Dutch election is going on and results

March 2017

March 14, 2017 German ZEW hit a 6 year high, China beat on Industrial Output..Yet CHina Retail Sales Missed BIG

March 14th, 2017

Yep the German ZEW hit a six year high. Shanghai Futures has copper a bit up (1/3 of a jump compared to yesterday’s pop). CHina retail sales had estimates around 10.6% and came in a mere 9.5%. Our Futures have been weak, with only down .12% in the third hour of the europe session. China Housing numbers per market watch is good while Shanghai Daily looking at the same data claims it is weaker. Oil is actually getting a bit up .60%. The data out of China was for Jan/Feb before China Govt lowered the GDP predictions and didn’t announce any massive infrastructure stimulus out of their Congress Meeting.

March 2017

March 13, 2017 the NCCPP Congress in China has Finished. Horizontal Growth.

March 13th, 2017

Shanghai Copper Futures rallied hard tonight along with a lot of the other metal. Our Futures are Flat, along witht he european market. Oil is softer down .18%. The China 10 day Meeting is done with no massive infrastructure plans coming from it. The China Tech stocks were up over a promise of stimulus money to be given to that sector (remember we mentioned that China wants to build it’s own Silicon Valley). The copper pop could be from the lack of progress in the Major Mines that are still in stock, yet Stocks of copper registered with the Shanghai Futures Exchange jumped 12,859 tonnes over the course of the last week and at 326,732 tonnes they are now 180,134 tonnes higher than at the start of January. So China isn’t in any threat of copper shortage.

March 2017