Worldwide Stocks, both developed and emerging are bid this morning a few reasons:
• A deal is reached at the EU summit regarding Migration, The positive take from this is that The Countries agreed on Something together even though it has a limited impact on Economy. Italy pushed hard for this deal
• ECB mulling an “operation twist” to keep long term rates low.10 and 30 year yields lower across Europe and Short term rates steady to higher ,with exception of Italy which sees rates lower across entire curve. How the twist is going to work is that ECB will reinvest proceeds from Expiring Bonds into the longer end of the Curve 10+ years and greater.
• The Yuan trading higher vs. Dollar for first time in 10 days, this is a risk on signal For Asian Stocks. Yuan headed for worst month ever vs. Dollar though
• US bank Stress test results showed no Worries for US Banks
• Euro Zone Inflation met expectations
Some negative news:
• President Trump threatening to pull out of the World trade organization (again)
• A major tax probe into European banks is ongoing
• Morgan Stanley warning on Commodities saying they face threats of Demand destruction from mounting trade tension and Slowdown in china-BB
• German retail sales missed expectations -2.1 vs -.5 M/M -1.6 vs +1.9 Y/Y
Month, quarter, and half-year end today will be an excuse for all moves. Stock markets In Italy, Germany and France +1.3%. Shanghai +2%, Taiwan +1.5%, Germany S Long End Buxl +50 ticks Bunds -16.Brent on the Bid +1.17%, WTI sideways trading unchanged. Plenty of Spread activity between the grades driving Flows. Today is last day to trade to August Brent. Major Crop report today at 11:00 one of the Busiest of the year historically.
No World Cup games today but I do not see any pickup in activity due to one-day break.
PCE Core at 7:30 will get plenty of attention but it rarely affects markets.
Mexico presidential elections this weekend.