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US Equities Set For Record Open On Crude Commentary, Stable Russian Ruble
There are two key events driving overnight risk prices: first, there is the Bloomberg story that "China Offers Russia Help With Currency Swap Suggestion", which was previously covered extensively here a week ago, but now that the algos have official confirmation that China will back Russia, they have sent the Ruble shorts into a panic short squeeze, with the USDRUB tumbling another 6% as of latest.
The other key development pushing oil prices modestly higher again, and Brent touching $63 overnight (if sliding fast since), is yesterday's speech by Saudi oil minister Ali al-Naimi who "expressed confidence prices will pick up", however not due to a drop in supply - because he made it very clear OPEC will never cut output and instead will wait for the high cost producers to exit the game - but amid improved economic growth. Which of course means the plunge in oil had little to do with supply and everything to do with demand, which in turn means the entire narrative has to be uprooted once again, and spun that rising oil prices are now bullisher for the economy than plunging oil prices. Frankly, it's difficult to keep track of all the constantly changing, relentless spin. And good luck with a surge in demand considering China's slowdown and its secondary impacts on Brazil and Australia (for a clear breakdown just see CAT's latest retail sales).
Finally, there is China, although not its economy but its stock market, which just like the west keeps rising ever higher the worse the economic prospects are. As a result, the SHCOMP rose to a fresh multi-year high of 3,189 before closing at 3,127, up 0.6%. Things have gotten so out of control for the politburo which now has to do with two main bubble: a housing one that is popping, and a soaring stock market bubble to replace it, that as the WSJ reports in the aftermath of the surge in Chinese stocks, "China Investigates Possible Stock-Price Manipulation" in hopes of slowing down if not bursthing this latest Chinese bubble.
In any event, with Brent higher the RUB stable, China soaring and the USDJPY in its traditionall blastoff mode the second Europe opened for trading in illiquid, low-volume pre-Christmas tape, we are virtually assured a new all time high in the S&P as the FX rigging algos do their best to push USDJPY solidly over 120 and with it, the S&P into record territory.
Heading into the Christmas period, volumes have been considerably light as expected with European equities trading in positive territory following the trend from Fridays Wall Street rally. Furthermore, the upside seen in oil prices from Friday has also continued, with the energy sector outperforming in Europe supporting European equities as the USD-index (-0.10%) is slightly weaker this morning. On the Eurozone political front, the GR/GE 10yr bond yield spread continues to remain tighter this morning as bribery claims are brushed aside as latest polls indicated that Syriza's lead in latest polling has narrowed; this comes ahead of the next Presidential vote on Tuesday. The Bund future has remained flat despite equities in the green as volumes are exceedingly light with less than 50,000 contracts traded, moreover, light volumes are expected throughout the holiday period.
Market Wrap
European shares remain higher with the oil & gas and chemicals sectors outperforming and basic resources, travel & leisure underperforming. China offers Russia ruble support with currency swap suggestion. Ruble strengthens. The Dutch and French markets are the best-performing larger bourses, Spanish the worst. The euro is stronger against the dollar. Japanese 10yr bond yields fall; Greek yields decline. Commodities gain, with natural gas, soybeans underperforming and wheat outperforming. U.S. Chicago Fed index, existing home sales due later.
- S&P 500 futures up 0.3% to 2073.2
- Stoxx 600 up 0.7% to 342.6
- US 10Yr yield up 1bps to 2.17%
- German 10Yr yield up 1bps to 0.6%
- MSCI Asia Pacific up 0.8% to 138
- Gold spot little changed at $1196.4/oz
Bulletin Headline Summary
- While the market remains relatively muted, the energy sector is granted some reprieve and in turn, lifting European equities.
- The GE/GR spread trades 16bps tighter with the Syriza poll showing their lead against the incumbent has narrowed.
- Looking ahead, on today’s light data slate we have Chicago Fed Nat. Outlook, US Existing Home Sales and a 2yr note auction.
FX
In FX markets, EUR/USD is among the outperformers in the pairs with support stemming from RANsquawk sources noting real money buying in EUR/GBP. NZD has pared back some of its overnight losses brought upon by weaker than previous NZ Westpac Consumer Confidence; (Q4) Q/Q 114.8 vs. Prev. 116.7. The USD-index has retraced some of Friday’s losses and has been edging marginally higher as lack of macro news flow has given the greenback much direction.
Friday’s CFTC report showed USD long positions narrowed for a fourth consecutive week, while net short EUR positions narrowed to their smallest since July and the narrowing in bearish AUD sentiment is the largest in 8 months. (ScotiaBank)
COMMODITIES
In the commodity complex, the USD has dictated much of the movements with WTI and Brent crude futures experiencing some earlier respite. However, both WTI and Brent crude futures have since come off best levels with the USD-index gradually edging higher from intra-day lows of 89.37. There were earlier reports that Libya said they are concerned about events around Mellitah oil port, adding Bahr Essalam offshore gas field output declined and are unable to fulfil contracts to international gas clients. In precious metals, Gold has dipped back below 1,200/oz as the USD continues to gain some momentum heading into the US crossover.
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Stable Russian Ruble
Welcome to the nanosecond market.
It's all Bullshit!!!
And if you like your bullshit, you can keep Bullshit.
And we Bullshitted some folks.
Let's get ready to ruble
Its fine at 54.8 .
Its fine at 54.8 .
Natural gas down almost 6%. What is happening? Nobody seems to care??
It's just a number, man - it doesn't connect to anything anymore.
There is no spoon.
+1 for the matrix reference
Agree. But it's a huge drop. And I thought it could still be a big deal on MM - theoretically.
Well I guess times are different now.
I'm looking at natgas too, have no idea what's happening or why either
caring isn't enough to make me knowing
Looking very good! DOW 18,000 just in time for Christmas. What a shocker!
As with realestate... Buy now or be priced out forever.
Uncle Feddy will just keep pumping MOAR!
Oil's cheap and record DJIA. What are you guys complaining about?
The bill.....if you want to pick this one up......we'll let you.
It's just a few trillion dollars.....we'll get the next one.
Naw, the next one's mine, but i'm waiting till it hits 2 quadrillion dollars before I pay.
They didn't build that ruble.
"Oil's cheap and record DJIA. What are you guys complaining about?"
because its not real
China's leadership know what is going on. The ruble isn't stable, and won't be for the foreseeable - but it sure is attractive at these prices.
Of course, more US/NATO/Zio fuckery in the form of bombing civilians in Ukraine and terror in southern Russia is to be expected. More actual false flags.... etc.
The MSM has gone full Orwell.
https://consortiumnews.com/2014/11/26/neocons-claim-to-fight-russian-unr...
http://www.voltairenet.org/article185870.html
I just - I can't believe how stupid people are, the same lies and horseshit after Iraq - since the USS Maine, Lusitania, Tonkin... the lies about sarin...
www.mintpressnews.com/the-failed-pretext-for-war-seymour-hersh-eliot-hig...
and on and on.
What fucking hope is there, with sociopaths in charge, a corporate/government/Zionist controlled press matrix, and a public too obtuse to do anything but beieve what they are told?
The MSM has gone full Orwell.
Yeah.....pretty much.
But at least it is now Winter in Europe...
Ayatollah Khamenei's six reasons what IS is
https://www.youtube.com/watch?v=R1H5Ik1iPZ0
Stable or Fable.. take your pick.
"Stable ruble" is currently 7.5% up on the day to 55.15 rubles per US dollar. After almost crashing to 80 rubles per US dollar last week.
"Stable"?!?!? WTF!!!
Unreported in West the ruble has steadily rallied back more than half its losses since last week's crash. Ruble/dollar now 54.4:1, was 80:1
It is not all "HAPPY DAYS!" as the markets suggest. In addition to manipulation by a corrupt government-financial complex other forces are converging to create a false loop further distorting and disconnecting Wall Street from the American economy.
The market has been all a twitter as we continue in a "greed and stupidity loop" that can best be explained as follows, stocks are rising so why get out, not getting out is causing the stocks to rise. We are experiencing a double down and let it ride mentality that has been ratcheted higher by media hype, but more is behind the stock market move.
Just as important it must be noted that as the dollar gains strength cross border money flows have become a massive factor. While these cross border flows have been good for the market I caution it does not fundamentally change the economy. Most analysts agree that money from countries with weakening currencies is flowing out of the troubled areas and into America. The article below delves into why this should not be considered a good thing as much as a signal of global instability.
http://brucewilds.blogspot.com/2014/11/why-american-equities-are-rising.html
The upper Bollinger Band on the S&P 500 sits right above 2100 now. There's your target for Mr. Market for Christmas this week.
After that, it's every man for himself, and the Devil take the hindmost.
Anybody who saw the S&P500 in the last 3 days would notice the sheer bullshit upward moves that brought it right back up to its previous highs in no time. Totally fucking manipulated shit right there. Every time there is a bear slide over a few weeks, it bounces back up within days due to concerted action.
it was manipulated on the way down too
So many ways for the PPT to make mola I am surprised they haven't IPO'd midget porn.
Overall trend is taking us to the stratosphere though.
Yellen: Its all bullish and its good for you.
George Carlin: Its all bullshit and its bad for you.
I trust the dead guy.
Overall trend is taking us to the stratosphere though...
For now.
You know if you trust too many times, you don't make too many birthdays. J.W.
Everyone back in the water! The shark is gone!
Bring back Geithner ; that sneaky little CUNT was far far superior in hiding the manipulation, unlike Corzine who just stuck his hand in the till. See a couple more awards and a huge future ahead for Paul Krugman and if some of you folks would give Mr Yellen half a chance you'll find that her balls are bigger than Ben's although a lot more shaving is required.
Barry's done a smashing jobs getting us folks 30 cents on the $$$$$$$$$$$$$$$ from the banks even though the MIC got 35 cents,
Hard Choices have had to be made, can't keep everyone happy so in choosing the 1% Barry's gonna try like fuck in his last 18 months to double that number.
Now on to today's frontrunning the numbers game . . . .
Just in time with the election!
Greece infringed EU sanctions against Russia and signed contract for air defense systems delivery http://investmentwatchblog.com/greece-infringed-eu-sanctions-against-russia-and-signed-contract-for-air-defense-systems-delivery/Why does Greece need air defense? To shoot down the EU troika Gulfstreams as Greece is gound into poverty by the troika?
Russia To Halt Ruble Slide, Increase Energy Ties With China: Marin Katusa, Chief Energy Investment Strategist At Casey Research
http://thenewsdoctors.com/?p=260950
http://investfts.blogspot.co.uk/2014/12/weekly-closings-stocks-oil-gold....
Weekly closings.
As Yogi Berra might say today, "it's real until it isn't." It has been very real to my investments over the last several years. It's only bullshit to those who missed out.
http://otdon.blogspot.co.uk/2014/12/the-oil-crash-is-not-saudis-fault.html
Just back the rouble with gold already. Unless they need more gold to do it. If they really want to fuck the western pieces of paper, that would be the way to do it. I hope it last a bit longer though, I'm getting used to getting silver at sub $20 prices, and got more collectin' to do.