OVERNIGHT MARKETS AND NEWS
June E-mini S&Ps this morning are little changed as the market awaits today’s FOMC meeting minutes. The Euro Stoxx 50 index is down -0.39% after yesterday’s rally. European energy stocks are trading higher on M&A optimism after today’s blockbuster deal in oil and gas with Shell buying BG Group to gain access in particular to LNG in Australia and deep-water oil in Brazil. Asian stocks today closed mostly higher: Japan +0.76%, Hong Kong +3.80%, China +0.84%, Taiwan -0.73%, Australia +0.59%, Singapore -0.14%, South Korea +0.63%, India +0.67%, Turkey +0.24%.
The dollar index is down -0.43 points (-0.44%) on a turn-around after the sharp 2-session rally. EUR/USD is up +0.0055 (+0.51%) and USD/JPY is down -0.57 (-0.47%). Jun 10-year T-note prices up 5.5 ticks going into today’s 10-year T-note auction.
Commodity prices are down -0.12% this morning due to lower energy prices. May crude oil is down -1.17 (-2.17%), May gasoline is down -0.0460 (-2.47%), and May natural gas is down -0.049 (-1.83%). The market is expecting today’s weekly EIA report to show a +3.0 million bbl increase in crude oil inventories, a -2.0 million bbl decline in gasoline inventories, a +800,000 bbl increase in distillate inventories, and a +0.6 point increase in the refinery utilization rate to 90.0%. The market is hoping for U.S. oil production to decline for the second straight week.
Precious metals prices are little changed this morning with Jun gold up +0.1 (+0.01%) and May silver up +0.010 (+0.06%). May copper is down -0.012 (-0.43%). Grain prices are narrowly mixed this morning as the market awaits Thursday’s WASDE report: May corn +0.25 (+0.07%), May soybeans +0.50 (+0.05%), May wheat -0.50 (-0.10%). Softs are trading higher this morning.
The Bank of Japan today left its monetary policy unchanged, which was in line with market expectations. The BOJ left its target unchanged of expanding the monetary base at an annual rate of 80 trillion yen ($670 billion). BOJ Governor Kuroda said that the Japanese economy now faces less risk than last year when the BOJ expanded its stimulus measures.
