KBR Capital Partners

Log in   

Login to your account


KBR Capital Partners Blog

market insight and commentary on futures markets

  • Home
    Home This is where you can find all the blog posts throughout the site.
  • Categories
    Categories Displays a list of categories from this blog.
  • Tags
    Tags Displays a list of tags that have been used in the blog.
  • Bloggers
    Bloggers Search for your favorite blogger from this site.
  • Team Blogs
    Team Blogs Find your favorite team blogs here.
  • Login
    Login Login form

Tuesday 2nd of September 2014 Market Report

Posted by on in Uncategorized
  • Font size: Larger Smaller
  • Hits: 1863
  • Subscribe to this entry
  • Print

Tuesday 2nd of September 2014 as of 11:00 CET

Yesterday, the US market was closed due to Labor Day. S&P500 futures made a new all time high this morning at 2006.25. EURUSD is testing 1.31 lows this morning, another 6 months low for that pair. The recent theme of European weakness in both FX and equities continues this morning.

The ECB will be the main factor this week...Their meeting will be Thursday... Here we doubt they will do more than talk about the details of the tltro...QE has about a 30% chance of being mentioned, but after reading the German magazine's comments about Merkel's call to Draghi, we doubt QE will be moving forward at this week's meeting...There is a chance the ECB could cut rates again this week, but we don't think so....It seems that the ECB has thrust the Euro into the carry trade arena.... With zero rates, hedge funds can borrow in Euros at zero and use the proceeds to buy higher risk assets....with the Euro in a steady decline, they will then be able to buy back the Euros cheaper...      
  Geopolitics....We talked to some Chicago Floor traders over the weekend concerning the Russian situation. They argued that Putin is trying to establish a corridor to Crimea to give him full access to the port... And once he accomplishes a state or corridor to Crimea, he will back off....Interesting... Either way, we are starting to think the worse the Ukraine/Russian situation gets the better for European markets...HUH?  The worse it gets the more the sanctions...The more the
sanctions the worse the Euro economy, especially Germany....The worse the economy, the more aggressive actions by the ECB.. The more the aggressive actions by the ECB, the better for the European markets...  The USA outlook...September is the worst market for equities...since 1950 September has been a down market 34 times....up markets 28...yet the US economy seems to be going strongly....of the S+P 500 reporting, 90% have met or exceeded their earnings expectations...on the other hand, of the 12,052 different ratings by sell side firms on the S+P 500 firms, 50% are buys, 44% holds, and only 6% sells....We would not be surprised to see an equity pull back of some kind this month, but if the ECB pushes on the pedal, the pull back could be put off....Bonds are a different story...The nonfarm numbers could be very surprising on Friday...the expectation is 225 on Bloomberg, while 240 in Barrons. An equity article in Barrons, talked about how Russell 1000 stocks have been outperforming Russell 2000 stocks....The reason being, when the US economy starts to heat up, Russell 2000 companies can no longer find cheap employees to hire...That seems to be going on now...

Asian markets closed higher overnight with Shanghai up 1.32%, Australia’s S&P/ASX 200 up 0.51% and Nikkei 225 up 1.24%.