Morning Briefing Global Economic Trading Calendar

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Feb 18, 2016 - A Eurex publication focused on European financial markets, produced ... Regional stocks have been trading
A Eurex publication focused on European financial markets, produced by MNl

Morning Briefing February 18th 2016 There is a full calendar on Thursday, although politics will be to the fore later in the day as EU leaders gather in Brussels to discuss the UK's attempts to renegotiate their standing within the EU. The data calendar gets underway at 0745GMT, when the French January final CPI data is published. The European Central Bank will publish the December current account data at 0900GMT, before the monetary policy accounts to Jan 21 are released at 1230GMT. Across the Atlantic, the US calendar kicks off at 1330GMT, as the latest jobless claims data and the February Philly Fed manufacturing index cross the wires.

The level of initial jobless claims is expected to rise by 6,000 to 275,000 in the February 13 employment survey week after a 19,000 decrease in the previous week. The Philadelphia Fed index is expected to improve modestly to -3.0 after rising to -3.5 in January, still indicating continued weakness in part of the Northeast. At 1500GMT, the US January Leading Indicator will be released. The index of leading indicators is forecast to fall by 0.2% in January after a0.2% decline in December.

Global Economic Trading Calendar

Positive contributions are expected from the longer factory workweek, a rise in the ISM new orders index, and rising consumer expectations. Those additions should be offset by negative contributions from higher jobless claims and lower stock prices. The EIA natural gas storage data will be published at 1530GMT, with the Crude oil stocks data expected at 1600GMT. San Francisco Federal Reserve Bank President John Williams speaks on the economic outlook, in Los Angeles, starting at 2030GMT. Late US data sees the M2 money supply numbers for the Feb 8 week published.

Markets FOREX: It's been a mildly eventful morning in the Asia-Pacific but major FX pairs have not really broken into any new territory so far. Some mild choppiness seen earlier on the release of Australian jobs data and China's inflation numbers but there have been no major lasting impact. Regional stocks have been trading higher, along with crude oil futures, keeping risk sentiment supported. Aussie-dollar was last at $0.7165, after an earlier retreat to a $0.7134 low soon after a surprisingly weak Jan jobs report. Dollar-yen traded up to Y114.33 high as Japanese stocks opened but spent the rest of the morning drifting lower to a Y113.80 low. It last trades at Y113.96. Eurodollar traded a $1.1119 to $1.1146 range this morning and was last at $1.1141. US INDEX FUTURES: US stock index futures are trading slightly higher as Asian equities play catch up to Wednesday's US equity markets gains, with the markets rapid approach of key technical resistance levels seeing some investor caution creep in. The e-mini S&P futures are rapidly approaching the half-way point of the 2074.50 to 1802.50 decline at 1938.50, which may cap the rally for now. Currently the Mar'16 e-mini S&P futures are trading up 3.24 points at 1,926.00, the Mar'16 e-mini Nasdaq futures are trading up 10.50 points at 4,207.25, while the Mar'16 e-mini Dow futures are trading up 29 points at 16,442. US STOCKS CLOSE: With oil prices buoyant and risk sentiment improved, US stocks posted solid gains again Weds.

The DJIA closed up 257 pts or 1.59% at 16,453.83, the Nasdaq Composite closed up 98 pts or 2.21% at 4,534.065 and the S&P 500 closed up 31 pts or 1.65% at 1,926.82. The S&P 500 topped out at 1,930.68 earlier. Today's S&P close above the psychological 1,900 mark was deemed promising, but the market wants to see a close above 1,947.20, the Feb. 1 high, before breathing a sigh of relief. The high for 2016 has been 2,038.20, seen Jan. 4, the first trading day of the year. The German DAX closed up 2.65% at 9,337.21, after trading in a 9,156.14 to 9,394.62 range. This month, the index peaked at 9,827.10 on February 1, still below the 9,905.08 high seen Jan. 28, the day before the BOJ announced that it would begin to charge negative interest on excess bank reserves.

JAPAN STOCKS: Japanese stocks have surged during Thursday's morning session, benefitting from strong gains on Wall Street and plunging short-end JGB yields on ongoing easing expectations. The Nikkei has closed for lunch up 2.47% or 390.87 points at 16,227.23, while the Topix is up 2.25% or 28.88 points at 1,311.28.

US TSY FUTURES: Also giving treasuries a bid tone has been comments from the Fed's Bullard who said that the Fed has "more leeway" on raising rates in the wake of falling inflation expectations and declining asset prices. As MNI's Steven Beckner writes "Bullard seemingly joined a rising chorus of policymaker calls for delay in further hikes in the federal funds rate", with the chorus getting louder after comments from the Fed's Rosengren and Harker in recent days. The Bullard comments also tried to deemphasise the importance of the SEP, as he said that the Fed's median funds rate projections may be misleading the public. Resistance of 10yr futures arrives at 130-19 ahead of 130-22, while 130-08 offers intra-day support.

OIL: WTI crude oil futures for Apr'16 delivery last up $0.49 at $33.47 per barrel, after a $33.38 to $33.98 range in Asia today, as volume switches over from the Mar'16 ahead of its expiry on Monday. After a decent rally Wednesday based on comments from Iran that they would support a production freeze, the contract also got welcome news in early Asia with the API inventory data showing a drop of 3.3m barrels and also a drop at Cushing, Oklahoma. However, since hitting the peak soon after it's been selling since with the DOE/EIA data due up Thursday. Some slightly more dovish comments from the fed's Bullard were largely ignored but volumes away from the spreads have been light.

PRECIOUS METALS: With the release of the latest FOMC minutes out of the way, precious metals markets have remained in consolidation mode during Far Eastern trading today as they await 'the next big thing'. Featureless sideways trade has been seen on exceptionally low turnover, metals investors disinterested in the latest central banker outpourings, this time the Fed's Bullard:

Technical Analysis BUND: (H16) Treading Water *RES 4: 166.49 Rising weekly channel top (2014 & 2015 Lows) *RES 4: 166.49 2016 Rising&weekly top11(2014 & 2015 Lows) 3: 166.16 Recordchannel high Feb *RES 3: & Record high Feb 11 2: 166.16 165.94 2016 Bollinger band top *RES 2: 1: 165.98 165.22 Bollinger High Feb band 12 top *RES 1: 165.22 High Feb 12 *PREVIOUS CLOSE: 164.26 *PREVIOUS CLOSE: 164.36 *SUP 1: 164.10 Low Feb 9, Rising daily channel base *SUP 1: 2: 163.72 163.25 Low Feb 8 4 *SUP 2: 3: 163.37 162.77 21-DMA *SUP 3: 4 4: 163.25 162.70 Low Feb Jan 29 *SUP 4: 162.70 Low Jan 29 *COMMENTARY: The lack of topside follow through Thursday was *COMMENTARY: continues to trade sideways as itsees hesitates followed up with a H16 sell-off and bearish close Friday that ahead of return the 163.72 and 165.22 resistance levels. Bears pressure to thesupport key 164.10 supports. Bears need to see a now for this a close 163.25 confirm breakpressure of the 21-with closelook below levelbelow to confirm antoeasing of abullish DMA and hint 162.70 at a deeper a close below then correction needed towith end below bullish162.70 hopes needed and shiftto confirm a shift in focus to160.53-161.55. 160.53-161.55 where 55 &O/B 100-DMAs immediate focus back to Correcting studies are located. Bulls still need a close above to reconfirm a adding weight to the bearish case and 165.22 above 165.23 is needed bullish biasbulls and with initially target the 165.98-166.16 region. to provide breathing space.

EUROSTOXX: Pressuring Key Resistance Layers *RES 4: 3055.38 High Jan 28 *RES 3: 2948.18 High Feb 3 *RES 2: 2922.34 Falling daily channel top *RES 1: 2900.31 21-DMA *PREVIOUS CLOSE: 2897.72 *SUP 1: 2860.27 Alternating daily support/resistance *SUP 2: 2786.21 Low Feb 15 *SUP 3: 2672.73 2016 Low Feb 11 *SUP 4: 2645.44 Low July 17 2013 *COMMENTARY: As daily studies correct from O/S and add support the bullish case the recovery from last week’s 2016 lows continues. The 21-DMA is currently capping with the 2900.312948.18 resistance region remains key with bulls needing a close above to confirm breaks of the 21-DMA and channel top and to shift focus to 3055.77-3239.06 where 55 & 100-DMAs are noted. Bears now need a close below 2860.27 to ease pressure on key resistance layers and below 2786.21 to reconfirm the bearish bias.

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