Yesterday’s market action
Yesterday’s ECB meeting attracted much attention but not for the usual reasons: Traders and market participants worldwide will look back on April 15th with fond and reverent smiles at the sight of Mario Draghi cowering before the fury of a confetti-wielding German activist. The Bund popped to a slight new high on the back of this but the meat of the move came from commentary that the Governing Council had no worries about scarcity of purchasable assets. Draghi also told the press that the deposit rate would remain unchanged and not be moved to allow the capital key to be extended as a result. The Capital Key remained unchanged also and the majority of market players were satisfied with the ECB’s decision; the Bund has pushed higher overnight with yields below 0.10% this morning. Greece remained at the centre of attention as we saw Greece miss its 1.5% budget surplus target, posting 0.4% for 2014. German finance minister Schaeuble commented that “no one expects a solution for Greece at the Eurogroup meeting on the 24th that the current government had “destroyed previous progress.” We have this morning seen large scale risk-off going into European bourses, with both ESTOXX and the DAX breaking technical supports and moving to make new lows. Greece has, this morning, approached the IMF to request a delay in repayments; the Bund has made new sustained highs on the back of this morning’s trade.
Today’s View
Ahead into the afternoon the calendar is fairly muted. Aside from some notable earnings estimates from the like of Blackrock at 1115BST and Blackstone group at 11am, this morning has also been on the Spartan side of things. This afternoon sees Goldman Sachs report at 1230BST; earnings per share are expected at $4.26 with the expected revenue at $9.31bn. Ahead this afternoon we have Initial Jobless and Continuing Claims, followed by Housing Starts and Building Permits. The construction figures are likely to post in-line as we see a pick up into the good weather, spurring the seasonal increase from the winter break. The Jobless claims number shouldn’t surprise markets as we do not see any persistent factors which would cause this number to increase greatly. We also have the Philadelphia Fed Business Outlook number this afternoon. While we see this as posting in-line please be aware of any misses or beats of the expected range.
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