US equities trade in positive territory with risk on sentiment rolling over from the European session after positive Spanish and Greek auctions and better than expected German ZEW Economic Sentiment Survey. Technology stocks are the outperforming sector in the S&P 500 led by Apple who have seen 3% gains, Apple stock is seeing strength after yesterday dropping 25% from all time highs seen in September due to a large bout of profit taking before expected tax rises next year. Also in the Tech sector Texas Instruments trade with 4% gains after an increase in its profit target late yesterday. There is a cautious optimism in the market as the pace of the fiscal cliff negotiations seems to quicken, however both sides have warned that an agreement remains uncertain. In terms of macro data markets have derived little direction from a mixed tranche of data with US Trade Balance coming broadly in line with expectations, a miss in NFIB Small Business Optimism Index and a beat in Wholesale Inventories. The focus of participants is now on the FOMC rate meeting tomorrow where rates are expected to remain unchanged but the Fed are expected to conduct treasury purchases. Treasuries trade in negative territory within a range, impacted by risk on appetite from the start of the session.
EUR/USD trades in positive territory following a general bid tone throughout the session after positive sentiment seen across European asset classes. Weakness in the USD is also contributing to the move higher in the pair with participants looking ahead to tomorrows FOMC meeting where there is expected to be an increase in asset purchases.
WTI and Brent crude futures trade in modestly positive territory after a session of choppy trade, contributing to the upside was the news that OPEC production declines and a weaker USD lent support to oil ahead of OPEC's policy meeting tomorrow. Looking ahead in the session API Inventories are due at 2130GMT.
11 Dec 2012 - 18:37 - Fixed Income Economic Commentary - Source: RANsquawk
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