Markets are very quiet before a half-day session that ends at 1pm EST today for stocks. Asian markets were relatively strong, led by the Hang Seng up 1.5%, continuing a strong one week rally that has put the Asian markets solidly back in the green on the year. European markets did not drop the baton, trading up 0.5% so far today on light volume. The Euro Stoxx is now down only 0.5% on the year, rallying more than 10% in the last month.
Economic data was very light in Asia. In Europe, UK PMI printed 48.2 vs. 52.9 expected, and Euro-Zone PPI printed -0.5% MoM vs. -0.3% expected. The market’s focus is on the ECB announcement on Thursday, where a 0.25% rate cut is expected. The real issue to watch is whether there are any new extraordinary measures announced. The base case expectation is for just a rate cut.
The dollar is slightly lower vs. most crosses, commodities are broadly higher, with Brent crude oil testing the $100 level for the first time since June 11th. Bonds are basically flat across the globe. Given that overnight spx futures traded in a 5 handle range, I expect a quiet pre-holiday session overall.