The Selloff Continues

Economic Data

• (BR) Brazil Mar FGV Inflation IGP-DI M/M: 1.5% v 1.6%e
• (IE) Ireland Mar Consumer Confidence Index: 83.1 v 85.5 prior
• (RU) Russia Mar Official Reserve Assets: $486.1B v $485.0Be
• (CL) Chile Feb Economic Activity Index M/M: 0.2% v 0.1%e; Y/Y: 2.9% v 2.5%e
• (US) Mar Average Hourly Earnings M/M: 0.0% v 0.2%e; Y/Y: 2.1% v 2.3%e; Average Weekly Hours: 34.5 v 34.4e
• (CL) Chile Feb Real Wage M/M: -0.2% v +0.7% prior; Y/Y: 2.5% v 2.7% prior
• (RU) Russia Q1 Consumer Confidence: -11 v -11 prior
• (CA) Bank of Canada (BoC) Q1 Senior Loan Officer Survey: -10.9 v -10.8 prior; Business Outlook Future Sales: 27.0 v 31.0e
  

- The big moves lower seen in US equity trading continued in Asia and European trading on Monday with few exceptions. This morning the three leading US indices are in the red, while the Russell 2000 down over 1% at its lows after falling below its 100-day moving average. Yield on the benchmark 10-year UST has come in a bit, -2.70 basis points. As of writing, the DJIA is down 0.65%, the S&P500 isd down 0.52% and the Nasdaq is down 0.69%.

- Tensions in Ukraine are at their highest levels since Russia seized Crimea. A small group of activists in the eastern city of Donetsk declared "independence" and asked the Kremlin to send in troops to ensure a separatist referendum. Ukraine's leaders say Russia's security services had sent the activists to seize government buildings in three cities a day earlier. The Ukrainian government said it would launch counter-terrorism operations against those responsible for raiding weapons stockpiles. Russia's MICEX is down nearly 3% this morning, the most in a month, and USD/RUB is above 35.5.

- In comments to the EU parliament this morning, ECB Vice President Constancio expanded on some of the thinking inside the ECB after last Thursday's rate decision and press conference. Little was new, but his comment that while no decision has yet been made on a QE program working groups are considering a range of hypotheses further confirmed that the ECB is ramping up for extraordinary policy if it is needed. Also, he said the ECB council would need to have unanimity to launch unconventional policy tools. EUR/USD has made steady gains off of support around 1.3690 overnight, and as of writing the pair is around 1.3742.

- Momentum stocks have ended their slide lower for now as buyers step in, helping to limit the downside in equities overall. Alcoa reports its March quarter results tomorrow after the close, unofficially opening the spring earnings season.

- World Wrestling Entertainment is down more than 16% this morning after the company disclosed that its new WWE streaming network had a total of 667K subscribers. WWE said the network is well on its way to reaching its goal of 1 million subscribers by the end of 2014, but investors clearly disagree.

- Questcor Pharma agreed to be acquired by Mallinckrodt in deal valued at $30/shr in cash and 0.897 shares of Mallinckrodt stock, for a total deal value around $5.6B. The transaction is expected to expand Mallinckrodt's offerings of specialty pharmaceuticals, namely Questcor's primary drug Acthar, which is used to manage difficult-to-treat autoimmune and inflammatory conditions.

***Looking Ahead***

- 11:30 (US) Treasury to sell combined $48B in 3-Month and 6-Month Bills
- 11:45 (US) Fed's Bullard in LA
- 15:00 (US) Feb Consumer Credit: $14.0Be v $13.7B prior
- 19:50 (JP) Japan Feb Current Account Balance: -¥618.1Be v -¥1.589T prior;
Adj Current Account: +¥24.7Be v -¥588.3B prior; Trade Balance: -¥593.6Be v -¥2.345T prior
- (JP) Bank of Japan (BOJ) Monetary Policy Statement