Futures vs FV: SP -0.4; DJ +20.38; NASDAQ +0.11
The ECB and Mario Dancing Draghi 'shocked' world markets with a taper from 80B euro purchases to 60B euro purchases/month, BUT it also expanded the range of assets the ECB can purchase (as it runs out of bonds to buy) AND extended the program for another 9 months.
Thus, something of a non-taper taper, pulling back in one important area, giving some expansion in 2 other areas.
Earnings Beats: COST, LULU, TLRD. All retail and apparel. Confidence is not only in businesses but the consumer as well.
China Exports: 0.1% year/year vs -5.0% expected vs -87.3% prior
OTHER MARKETS
Bonds: 2.398% vs 2.349% 10 year
EUR/USD: 1.0678 vs 1.0755. Dollar jumping against euro after Drahgi, ECB
USD/JPY: 113.862 vs 113.325
Oil: 50.25, +0.48. Can oil hold on and take out 52-53 this time? The initial reaction to that resistance was lower.
Gold: 1174.70, -2.80
Despite the ECB's actions, US futures have held steady since early morning, indeed drifting higher toward the open. The exuberance (irrational?) has not worn off though it is taking a siesta to start today. Low to high Wednesday, flat to higher today? Hate to assume the upside, but there are a lot of stocks still working into the upside.
After such a big upside day perhaps stocks will be a bit sluggish. Watching our plays that have surged to see how they act today, i.e. if there is any topping indications to take some gain on. At least there won't be a lot of gaps higher today to sell into.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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