Watching Bonds Today Amid Global Earnings Growth

11/06/2017 11:44 am EST

Focus: STOCKS

Robert Savage

Partner & CEO, CCTrack Solutions

The European rally in fixed income today is more about the data and the central banker speeches ahead. The U.S. markets are going to drive today on the rest of the world and earnings more than on anything else, writes Bob Savage, CEO of Track Research Monday.

The mood for Monday remains foggy like the weather.

This isn’t a market roaring to go higher in equities, nor to lift rates further even as evidence continues to show robust global growth and expectations for the future. The talking points are about the sadness of another mass shooting in the U.S. (our thoughts and prayers to those in Texas as they search to understand who is Devin Kelley and why Sutherland Springs), to the Trump Asia trip where Abe and trade were the first focus followed by North Korea and diplomacy, to the Saudi Crown Prince Mohammed bin Salmanpower cleaning with clerics the next focus, adding to oil rally, to the UK where Brexit talks remain focus – E60bn price reported by Sunday Times – where New York Fed president William Dudley appears ready to retire according to multiple press stories.

Oil and the role of the Venezuela debt restructuring (read as default) continues to play out as well.

Those stories were important in setting the flat trading in Asia, but the European rally in fixed income today is more about the data and the central banker speeches ahead. The U.S. markets are going to drive today on the rest of the world and earnings more than on anything else.

The data overnight was strong enough to keep up the global growth theme and yet not worrisome enough to drive up rate hike concerns. The lynchpin for the market maybe in that bond move and where it ends today matters with the 200-day at 2.31% looking important.

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