RANSQUAWK JULY 28th-29th FOMC MINUTES PREVIEW - Participants will be looking for communication as to when the FOMC will start to normalise rates and how close US economy is to meeting the central bank's criteriaSubmitted by RANSquawk Video on 08/19/2015 05:59 -0500
PREVIEW: July 28th-29th FOMC minutes due at 1900BST/1300CDT
- Markets looking for clarification for a September or December lift-off after the FOMC statement did not send any overt signals
Chinese Intervention Rescues Market From 2-Day Plunge, Futures Red Ahead Of Inflation Data, FOMC MinutesSubmitted by Tyler Durden on 08/19/2015 05:37 -0500
With China's currency devaluation having shifted to the backburner if only for the time being, all attention was once again on the Chinese stock market roller coaster, which did not disappoint: starting off with yesterday's dramatic 6.2% plunge, the Shanghai Composite crashed in early trading, plunging as much as 5% in early trading and bringing the two-day drop to a correction-inducing 11%, and just 51.2 points away from the July 8 low (when China unleashed the biggest ad hoc market bailout in capital markets history) . And then the cavalry came in, and virtually the entire afternoon session was one big BTFD orgy, leading to a 1.2% gain in the Shanghai Composite closing price, while Shenzhen and ChiNext closed up 2.2% and 2.7%, respectively.
China Stocks Crash, More Than Half Of Market Halted Limit Down; PBOC Loss Of Control Spooks Global AssetsSubmitted by Tyler Durden on 08/18/2015 07:09 -0500
Just hours after the PBOC announced a modestly "revalued" fixing in the CNY, which curiously led to weaker trading in the onshore Yuan for most of the day before a forceful last minute intervention by the central bank pushed it back down to 6.39 it was the local stock market spinning plate - which had been relatively stable during the entire FX devaluation process - that China lost control over, and after 7 days of margin debt increases the Shanghai Composite plunged by 6.2% in late trade, tumbling 245 points to 3748, just 240 points above its recent trough on July 8, a closing level some 27% off its June peak.
RANSQUAWK WEEK AHEAD VIDEO - 17th August - Markets remain concerned about China, key releases include US CPI and FOMC MinutesSubmitted by RANSquawk Video on 08/17/2015 07:19 -0500
- Markets will be keeping a close an eye on what action/if any the PBoC take to try and keep Chinese growth prospects on course.
- Main releases this week come in the form of US and UK CPI reports and the FOMC minutes release
The overnight market has been a repeat of yesterday's action, when following China's repeat 1.6% devaluation of the CNY (which was to be expected since the PBOC made it quite clear the fixing would be based off the market value, a value which continues plunging), the second biggest in history following Monday's 1.9% plunge, traders appeared stunned having believed the PBOC's lies that the devaluation was a one-off and as a result the E-Mini tumbled overnight, and is now 30 points lower from last night's PBOC fixing announcement, trading at around 2058, and far below the "magical" 200-DMA support line, which has now been solidly breached.
Despite claiming yesterday's devaluation was a "one-off", The PBOC has devalued the Yuan Fix dramatically for the 2nd day in a row - now 22 handles weaker than Monday's Fix. Offshore Yuan is trading at 4 year lows against the USD. The carnage from this dramatic shift is just beginning as global equity markets (US futures to China cash) are tumbling, US Treasury bond yields are crashing, gold is up, China credit risk is at 2 year highs, and China implied vol has exploded to 4 year highs. Ironically, China's government mouthpeiece Xinhua explains "China is not waging a currency war; merely fixing a discrepancy."
The entire US Treasury complex has seen yields plunge following last night's "surprise-that-everyone-except-Wall-Street-economists-saw-coming" Yuan devaluation. While there are numerous factors driving the rally in bonds, RanSquawk notes two crucial ones... that will likely persist...
If yesterday it was the turn of the upside stop hunting algos to crush anyone who was even modestly bearishly positioned in what ended up being the biggest short squeeze of 2015, then today it is the downside trailing stops that are about to be taken out in what remains the most vicious rangebound market in years, in the aftermath of the Chinese currency devaluation which weakened the CNY reference rate against the USD by the most on record, in what some have said was an attempt by China to spark its flailing SDR inclusion chances, but what was really a long overdue reaction by an exporter country having pegged to the strongest currency in the world in the past year.
Following last week's bad news for the economy (terrible ADP private payrolls, confirmed by a miss in the NFP) which also resulted in bad news for the market which suffered its worst week in years, many were focused on how the market would react to the latest battery of terrible economic news out of China which as we observed over the weekend reported abysmal trade data, and the worst plunge in Chinese factory prices in 6 years. We now know: the Shanghai Composite soared by 5%, rising to 3,928 and approaching the key 4000 level because the ongoing economic collapse led Pavlov's dog to believe that much more easing is coming from the country which as we showed last night has literally thrown the kitchen sink at stabilizing the plunge in stocks.
RANsquawk Week Ahead - 10th August 2015: US data is set to remain in focus as participants look ahead to the possibility of a Sep Fed rate lift-offSubmitted by RANSquawk Video on 08/10/2015 05:26 -0500
· US data is set to remain in focus as participants continue to try to gauge the possibility of a September rate lift off
· Key data out of the Eurozone this week includes Q2 GDP as well as German ZEW
RANsquawk Video: BoE's "Super Thursday" sees weakness in GBP while a US Sep'15 rate hike remains on the table following NFPSubmitted by RANSquawk Video on 08/07/2015 11:19 -0500
- US Change in Nonfarm Payrolls (Jul) M/M Exp. 225K (Low 140K, High 310K), Prev. 223K, May. 280K
- US Unemployment Rate (Jul) M/M Exp. 5.3% (Low 5.2%, High 5.4%), Prev. 5.3%, Apr. 5.5%
- US Average Hourly Earnings (Jul) M/M Exp. 0.2% (Low 0.1%, High 0.3%), Prev. 0.0%, Apr. 0.3%
Today the Bank of England releases its rate decision, minutes and quarterly inflation report (QIR) all at 1200BST with the QIR press conference to be held by Governor Carney at 1245BST. Given the volume of information on offer, the release is likely to be met with volatility.