- Foreign banks squeezed by Fed may reduce US footprint - MarketWatch
- Cash flies into bond ETFs - WSJ
- I said, you can call me Cleverbot if you want to - Economist
- Do we even need a Fed balance-sheet reduction? - Alphaville
- Templeton braving China's housing bubble - Bloomberg
- Mark Twain
Following further developments between Ukraine and their predominantly Russian-inhabited Crimea region (evidently Russian "military" has occupied two airports), European markets are trading slightly lower. The Euro STOXX 50 is down 0.58%, with the FTSE lower by 0.20% and the DAX barely off at -0.14%. Today's US open looks eerily similar to yesterday's. S&P futures are off 1.75 points, with Dow and Nasdaq futures lower by 8.00 and 3.75 points, respectively.
Asian markets were mixed overnight - the Nikkei lost half a percentage point, while Hong Kong was flat and the mainland Shanghai Shenzhen 300 was up 1.15%. News-flow, aside from Ukraine, has been rather light. The US economic data calendar begins at 8:30am with 4Q GDP revisions, followed by Chicago PMI, the UofM (that school up North) consumer sentiment index for February, and pending home sales. I expect markets to be most sensitive to GDP data - consensus expectations are for a revision to 2.4% growth.
I still expect the "surprise" move to be to the upside over the near-term. It is hard to pound the table and indiscriminately smash the "buy" button at current levels, but taking some selective longs (while not risking much downside) seems appropriate.
Interestingly, bonds have been rallying alongside the equity market - this is likely a further sign of the lack of "believers" in the rally. I believe strength in the bond market is short-term; they won't be able to hold the bid if economic data continues to improve over the next few months.
Time will tell. Until then, put the odds in your favor, folks.
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