The Fuse
What are futures doing?
A moderate rally this morning but nothing too firm, markets were volatile overnight as the Brazilian market blew up. That market is down sharply on that news but no doubt will shake it off. A big week of news ahead of us with more than 1/3 of the SPX 500 reporting. Indices are trying to recover from last week’s miserable finish.
News
Seeing moderate gains across Europe, the STOXX up .5% led by gains in France and Germany. The FTSE up about 1%. Gold is rallying as is silver, crude oil down about 3% while the dollar is modestly lower. Bund yields from Germany were up about 3bps while the US 10 yr treasury ticked up about 1bp, in Asia gains across the board in Japan, Shanghai and Hong Kong.
Volatility
Volatility is elevated and thus means more big movements are going to happen. VIX is at 19+ here and while that is about the normal area, it is higher than recent trends and above the 200 day moving average. We could see a shifting to bullish volatility soon.
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