US equity markets are displaying similar price action to that seen at the European cash close, with mixed performance as the S&P500 sits in minor positive territory and the Nasdaq in the red as Apple and its Tech stocks peers weigh on the index. Despite solid upside in riskier assets heading into the open in Wall Street after a better than expected jobs report, markets have since largely pared the moves, shrugging off the positive reading as a lack of progress on the fiscal cliff weighs on investor demand. US House speaker Boehner confirmed such sentiment after announced that “there is no progress to report on the fiscal cliff”.
A usually quiet start to non-farms Friday was broken this morning with a series of market moving source comments on a potential change to ECB rates in the New Year. It was implied that several members of the ECB council favoured a cut at yesterday’s meeting, and more recently sources noted that just ECB president Draghi, ECB's Coeure, Asmussen and Weidmann prevented a rate cut on Thursday. After selling pressure in the EUR currency, the EUR/USD pair has recovered some of the initial downside, consolidating today’s price action above the 1.2900 handle after going through the London close. Treasuries remain lower on the day despite increased speculation of outright treasury buys from next week’s FOMC meeting, and still hold onto losses experienced following the lower unemployment rate and higher non-farm payroll numbers than expected. T-notes have since traded sideways after paring just around ¼ of the initial downside, compared with an almost 100% paring in equities.
Little remains on the calendar for the rest of today, however the Greek bond buyback operation was scheduled to close at 1700GMT (1100CST) so an official statement from the Greek PDMA would not be unexpected, plus any source comments indicating take-up at the offering could soon hit the screens.
Print 17:50, 07 Dec 2012 - Market Analysis - Source: RANsquawk
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