OVERNIGHT MARKETS AND NEWS
Dec E-mini S&Ps (ESZ17 -0.21%) this morning are down -0.23% on long liquidation ahead of several potential market moving events in the U.S. this week including Wednesday’s FOMC decision, President Trump’s nomination of a new Fed Chair, and Friday’s monthly payroll data. European stocks are up +0.16% after Eurozone Oct economic confidence rose to a 16-1/2 year high and as Spain’s IBEX Stock Index rallied +1.31% as political tensions in Spain eased after the Spanish government began the process of reasserting control over Catalonia. Asian stocks settled mixed: Japan +0.01%, Hong Kong -0.36%, China -0.77%, Taiwan +0.45%, Australia +0.27%, Singapore -0.31%, South Korea +0.35%, India +0.33%. Japan’s Nikkei Stock Index climbed to a new 21-year high on carry-over support from Friday’s gains in U.S. equities to new record highs. China’s Shanghai Composite tumbled to a 1-month low as a slide in China’s bond market deepened amid concerns about deleveraging. China’s 10-year government bond yield jumped 8 bp to 3.93%, near a 3-year high, which will boost funding costs for Chinese companies as more than 1 trillion yuan ($150 billion) of funding provided by the PBOC matures this week, the most in 8 months.
The dollar index (DXY00 -0.28%) is down -0.28%. EUR/USD (^EURUSD) is up +0.26%. USD/JPY (^USDJPY) is down -0.05%.
Dec 10-year T-note prices (ZNZ17 +0.18%) are up +9 ticks.
German Sep retail sales rose +0.5% m/m, right on expectations.
Eurozone Oct economic confidence rose +0.9 to 114.0, stronger than expectations of +0.3 to 113.3 and a 16-1/2 year high.
Japan Sep retail sales rose +0.8% m/m, right on expectations.
U.S. STOCK PREVIEW
Key U.S. news today includes: (1) Sep personal spending (expected +0.9%, Aug +0.1%) and Sep personal income (expected +0.4%, Aug +0.2%), (2) Sep PCE deflator (expected +0.4% m/m and +1.6% y/y, Aug +0.2% m/m and +1.4% y/y) and Sep core PCE deflator (expected +0.1% m/m and +1.3% y/y, Aug +0.1% m/m and +1.3% y/y), (3) Oct Dallas Fed manufacturing activity (expected -0.3 to 21.0, Sep +4.3 to 21.3), (4) USDA weekly grain export inspections, (5) USDA crop conditions and progress report.