3 Things to Know before Trading

Stocks were weak throughout Asia. Shanghai lost almost three percent on the day, the Hang Seng fell 1.7%, the Nikkei lost more than one percent and so too did Australia. European indexes are mixed, but the Footsie is currently lower by about one and a third percent and the Dax is off by 0.7%. US stock futures are down about a quarter percent.

*China released a lot of data last night; among the reports, all of which are on a year over year basis, were: Q4 Real GDP +9.8%, four tenths more than forecast; Year to Date GDP +10.3%, one tenth better; December reading of the Consumer Price Index hit the estimate at +4.6%; December reading of the Producer Price Index +5.9%, two tenths higher than expected; December reading of Industrial Production +13.5%, one tenth more than forecast; and December reading of Retail Sales +19.1%, four tenth above the estimate.

*The final November reading of Japan’s Leading Economic Index was revised down four tenths to 100.6, but that is still the best result since April.

*The December reading of the German Producer Price Index is +0.7%, two tenths higher than expected.

*The January reading of Switzerland’s ZEW Survey of Expectations for Economic Growth was down six points on the month to -18.4, according to Credit Suisse.

*The weekly report on Initial Jobless Claims is due out at 7:30am CST, it is expected to be 420k. The December reading of Existing Home Sales is one of three reports that are due out at 9:00am CST; Sales are forecast to rise 4.1% on the month to an annualized rate of 4.87 million units. The January reading of the Philly Fed Business Activity Index is another nine o’clock report, this is expected to be steady, at 20.8, from the revised lower December result. Leading Indicators is the third 9:00am report, it is forecast to be +0.6%.

*The weekly report on inventories of Natural Gas is due out at 9:30am CST, it is expected to show a decline of 235 bcf. The other weekly energy inventory report, delayed because of the holiday, is due out at 10:00am CST. Stocks of Crude Oil are forecast to decline 500k barrels, Gasoline inventories are expected to increase 2.5 million and the estimate for Distillates is +1.0 million.

*The Fed is scheduled to buy Treasuries today that are due to mature between 8/15/28 and 11/15/40; the results of the operation will be announced just after 10:00am CST.

*The Treasury will at 10:00am CST announce the details for next week’s auctions of 2 Year, 5 Year and 7 Year Notes.

*China President Hu is scheduled to give a luncheon address at 11:30am CST and then moves on to Chicago for a dinner with business leaders.

*The Treasury plans to sell $13 billion 10 Year TIPS today; the results of the auction will be announced just after noon CST.

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