Deutsche Bank

Bond Rout Fades With Futures Flat Ahead Of Payrolls; Pound, Yen, Oil Tumble

S&P futures are little changed following yesterday's rout even as Asian and European markets continued selling; the pound slid on poor factory data, the yen tumbled after the BOJ intervened to stabilize the JGB bond market, precious metals flash crashed early in the session, while the selloff in oil accelerated despite yesterday's massive inventory draw, although at least yesterday's sharp bond tantrum has stabilized.

The Reason Why Gold & Silver Have Frustrated Investors Since 2011

"Current levels of complacency are alarming. This is what everyone is talking about. Despite growing uncertainties and tensions, the market volatility refuses to rise. Persistence of low volatility is increasing the penalty for potential dissent and reinforces one sided positioning. As a consequence, the risk of disorderly unwind is growing."

French Market Regulator Sees "Brutal Repricing Of Assets"; Valuations, Volatility "Don't Reflect Real Uncertainty"

"Equity market volatility therefore now appears to be decorrelated from [uncertainty]... combined with high valuations on some equity markets, especially in the US... and extremely low spreads on the bond markets, raises questions as to whether the risks affecting the financial markets are being underestimated, which may lead to a brutal repricing of assets."

Abe "Plunges Into Crisis" After LDP Suffers "Historic Defeat" In Tokyo Elections, USDJPY Slides

On Sunday Japanese PM Shinzo Abe’s Liberal Democratic Party suffered what Reuters called a "historic defeat" in the Tokyo assembly election, and "plunged into a crisis" after losing to an upstart outfit in an vote that is seen as a harbinger for Japan's national elections, and signaling trouble ahead for the premier who has suffered from slumping support after a series of political scandals.

Deutsche: The Market Broke In 2012, "This Is What Everyone Is Talking About"

"After 2011, the two measures of risk decouple with VIX consistently low despite growing uncertainty. The breakdown is structural, and it is visible across all market sectors, not only equities. Current levels of complacency are alarming. This is what everyone is talking about... The longer this regime continues, the lower the threshold of painful unwind."

“The Discord Is Obvious" - Merkel Slams Trump Ahead Of G-20

In a speech to lawmakers in Germany’s lower house of parliament on Thursday, Merkel said that “the world has become less united” and acknowledged that discussions at the G-20 meeting in Hamburg on July 7-8 “will be very difficult.” Quoted by Bloomberg, Merkel said that “the discord is obvious and it would be dishonest to paper over the conflict."

Euro Surges, Yields And Stocks Rise As Central Banks Deliver Coordinated Message

The euro soared to the highest level in over a year while bond yields and global shares also climbed, as an ongoing barrage of coordinated hawkish comments from central banks signaled the era of easy money might be coming to an end for more than just the United States. S&P futures were fractionally in the green following the best day for US equities in two months.