Euro-denominated emerging market sovereign issuance will soar to its highest levels in 10 years on the back of the European Central Bank's quantitative easing programme, as issuers outside the eurozone seek to take advantage of falling euro yields, according to bank analysts.
Despite still low crude oil prices, gas prices at the pump have been on the rise recently. While still at levels not seen since 2009, gas prices in February have surged at the fastest pace in at least a decade to 2-month highs. As SMRA notes, shutdowns at some refineries due to strikes has been a good part of the reason for the gain in recent weeks, but prices for gasoline also typically start to rise with the approach of spring as refineries prepare to change over to less polluting formations for the summer months. We assume, in some incredible way, higher gas prices are also a positive for the US economy (just as lower gas prices were... not).
and more news moving the markets
Although it may be unrealistically optimistic, I believe my paraphrase of a Churchill quote:
While Crude Oil and Dr. Copper are often cited as economic indicators, as we noted previously, in fact Lumber prices are the most correlated with ISM and GDP of all industrial commodities (h/t @Not_Jim_Cramer). That is a problem. Lumber prices are tumbling - breaking to 18-month lows today. We have seen this picture before, and it did not end well...
Stock market investors live by the Apple and die by the Apple... and with Apple's 2.5% drop today, broad stock market indices have cratered in the last few minutes retracing the gains accrued since Yellen started speaking yesterday...
Oil prices dumped (last night's major 8.9 million barrel inventory build from API), pumped (the Saudi minister claiming "demand is growing" - which just seems like total fiction given economic backdrops and China's VLCC count plunge), and then this morning, dumped setting the scene for this morning's EIA inventory data. Against expectations of an 8 million barrel build, crude inventories saw a 8.43 million barrel build (5 times higher than the 5 year average). Record levels of production and record total inventrory sent WTI plunging out of the gate but it is stabilizing for now...
There was an expectation that today's receipt by the Troika of the revised Greek "reform proposal" would send risk and the EUR higher, which is probably precisely why nothing has happened so far, and US equity futures are unchanged ahead of what the HFT algos' new attention focus is today, namely Yellen's semi-annual testimony to Congress. As a result, the only thing that has seen notable strength this morning is the USD, which has surged to 119.50 against the Yen, and briefly pushed the EURUSD under 1.1300. which also means that WTI has also gone nowhere overnight and remains under $50. One wonders just what OPEC "rumor" those long crude will leak today.
Because when in doubt how to best start a war, lie.
UPDATE: *OPEC SAID TO HAVE NO PLANS FOR EMERGENCY MEETING
Crude oil oprices have spiked higher after The FT reports members of OPEC have discussed holding an emergency meeting if crude continues to slide. This would entirely contradict Saudi Arabia's previous statements and, we suspect, means this was more a hope than a statement as the Nigerian Naira collapses... “Almost all OPEC countries, except perhaps the Arab bloc, are very uncomfortable," said Ms Alison-Madueke, adding if the price "slips any further it is highly likely that I will have to call an extraordinary meeting of Opec in the next six weeks or so."
Recently, the Baker Hughes Rig Count has become all the rage. The problem is that not all rigs are created equal, and what we see is still a “net” number. We see the net number of rigs that are working. The reality is that some new projects continue to come on line and are very high producing wells, and some of what is being taken away, was either old, or projects that hadn’t yet been contributing production. While many have pointed out that the drop in rig count is not changing production, they are quickly learning the lesson of trying to get a few facts to stand in the way of a good meme, but we think they are about to get listened to... while oil has stabilized, the next leg is likely lower.
Perhaps the world is beginning to realize that "it's the demand, stupid" as crude oil prices are collapsing this morning (not helped by "all out production" news from Oman). While 'markets' rallied peculiarly after last week's epic surge in inventories and production data, that has all been given back as one trader noted "the market got ahead of itself, even though the rig count has been falling it is not until mid-yr that we are going to see some impact on supply." WTI is back under $49. To complete the gloom, Copper is probing lower, breaking key support with projections to 222.50 if this move takes shape.
Either all futures market participants are comically inept or demand is the variable that shifted hard. Those are the only two possibilities.