OVERNIGHT MARKETS AND NEWS
March E-mini S&Ps (ESH15 -0.54%) this morning are down -0.15% at a 4-week low and European stocks shed losses and are up +0.55% after comments from ECB Executive Board member Coeure bolstered speculation the ECB will embark on a program of buying sovereign debt at its meeting next Thursday. The fallout from Thursday’s surprise move by the Swiss National Bank (SNB) to abandon its currency cap led to huge losses in the forex market with New Zealand’s Global Brokers NZ Ltd. saying that losses from the franc’s surge are forcing it to shut down and British broker Alpari Ltd. said it “entered into insolvency.” Also, FXCM Inc., the largest U.S. retail foreign-exchange broker, said clients owe $225 million on their accounts and threaten the firm’s compliance with capital rules. Asian stocks closed mostly lower: Japan -1.43%, Hong Kong -1.02%, China +0.86%, Taiwan -0.29%, Australia -0.60%, Singapore -1.14%, South Korea -1.44%, India +0.17%. Japan’s Nikkei Stock Index dropped to a 2-1/2 month low after the SNB’s unexpected scrapping of its currency cap prompted investors to avert risk and dump stocks. Chinese stocks bucked the trend and rallied on speculation the PBOC will soon cut reserve-requirement ratios. Commodity prices are mixed. Feb crude oil (CLG15 +2.21%) is up +2.72%. Feb gasoline (RBG15+1.47%) is up +2.20%. Feb gold (GCG15 -0.17%) is down -0.37%. Mar copper (HGH15 -0.23%) is unch. Agriculture prices are higher. The dollar index (DXY00 +0.16%) is up +0.13%. EUR/USD (^EURUSD) is down -0.40%. USD/JPY (^USDJPY) is up +0.46%. Mar T-note prices (ZNH15 +0.28%) are up +8 ticks.
In a sign that the ECB will implement quantitative easing at next Thursday’s policy meeting, ECB Executive Board member Coeure said that for QE to be efficient “it would have to be big” and that “we will take into account the American and British experiences to determine the amounts of bonds to buy.”
