European Union

The Selling Is Back: S&P Futures Tumble Below 1,900; Sterling Crashes, Gold Soars

On Monday, everyone was giddy that the rally is back on. Less than two days later, the dour fatalism of some HFT algo stop hunting price action and a few comments by the Saudi oil minister, and the markets have remember than nothing has changed and that nothing has been fixed. But at least the biggest shorts squeeze in 5 years is finally over.

Frontrunning: February 24

  • Shares fall with oil prices, yen in demand (Reuters)
  • Trump's third straight win has rivals looking for answers (Reuters)
  • How Marco Rubio Blunted Ted Cruz—and Boosted Donald Trump (BBG)
  • Donald Trump Seals GOP Front-Runner Status With Nevada Win (WSJ)
  • Fischer says no Fed plan to move to negative interest rates (Reuters)
  • Lew Says Don't Expect `Crisis Response' From Group of 20 Meeting (BBG)

One Trader Explains Why He Did Not Chase Yesterday's Buying Panic

What kept me from totally losing my heart was, yet again, the bond market. If animal spirits are alive, and the underlying fundamentals improving, how come bond yields are struggling to make even a dead-cat bounce?... It’s not just liquid and illiquid, but house money and rent money. Equities clearly fall into the former camp: chasing the latest news without caution. Bonds on the other hand are ignoring today’s emotions and asking what has fundamentally changed. And the answer they’ve settled on is "nothing"

Frontrunning: February 23

  • Risk rally fades as stocks, oil slip back into the red (Reuters)
  • Syrian govt. accepts halt to 'combat operations' in line with U.S.-Russian plan (Reuters)
  • Earliest Chinese Data Signal Slowdown Hasn't Bottomed Out Yet (BBG)
  • The Trickle of U.S. Oil Exports Is Already Shifting Global Power (BBG)
  • Greek police remove migrants from Macedonian border as more land in Piraeus (Reuters)
  • Clinton, Sanders race takes on angrier tone after Nevada (Reuters)

Is The Short Squeeze Over? Global Rally Fizzles, Futures Lower

The biggest question on all traders' minds will be whether the bear market short squeeze that sent the S&P higher by 130 points in 6 days, is finally over - with most global market rolling over and with US equity futures unable to find their  solid early morning footing, it may finally be time to cash out of the bear market rally which so many predicted, and which GSBank yesterday may have top-ticked with perfection.

Frontrunning: February 22

  • Futures sharply higher as oil extends gains (Reuters)
  • Global Stocks Gain on Rising Commodities Prices, China (WSJ)
  • Pound in freefall as Boris Johnson sparks Brexit fears (Telegraph)
  • Pound Slides Most Since 2009 as Johnson Backs ‘Brexit’ Campaign (BBG)
  • Oil Glut Will Persist Into 2017 as IEA Sees Prices Capped (BBG)
  • Japanese Seeking a Place to Stash Cash Start Snapping Up Safes (WSJ)

Markets Surge On Chinese Debt Flood; Worst European PMI In Over A Year; Crashing Pound

Propped up by the Chinese central bank and by a generous Chinese finance ministry, with further hopes a backsliding European economy will mean even more easing by Draghi, the risk on mood is back: "People are willing to take risk again,” Karl Goody, a private wealth manager at Shaw and Partners Ltd. in Sydney told Bloomberg. “People are looking at the selloff this year and saying: enough is enough, there’s been enough pain now."

Cameron Unleashes 'Project Fear' - UK Military Leaders Warn Against Brexit Threat To National Security

Just as the government did in the lead up to The Scottish Referendum in 2014, it appears David Cameron is already unleashing resorting to the so-called Project Fear. As The Telegraph reports, following Boris Johnson's lack of acquiescence to Cameron's call for no Brexit, more than a dozen of the country's most senior military leaders will argue that Britain should vote to stay in the European Union because of its importance to national security.

Ahead Of Boris Johnson's Key Sunday Night Announcement, Here Is What British Politicians Think Of The Referendum

With the date of UK's EU referendum now set for late June, both side are nervously awaiting the verdict of the mayor of London, who, the Observer understands, intends to make a statement on Sunday night on which side he will back. If both Gove and Johnson, two of the best communicators in Tory ranks, side with the Out campaign, many MPs believe the prime minister will face an uphill struggle to convince voters that their best interests lay in remaining inside the EU.

The Chilling Ways The Current Global Economy Echoes The 1930s Depression Era

The imbalances that low rates and elasticity produce may “return us to the modern-day equivalent of the divisive competitive devaluations of the interwar years; and, ultimately, [trigger] an epoch-defining seismic rupture in policy regimes, back to an era of trade and financial protectionism and, possibly, stagnation combined with inflation.”