5 Things to Know Before Trading

*Stocks were mixed in Asian trade. The Hang Seng and Australia each gained a slight fraction, while the Nikkei fell more than 0.8% and Shanghai was down a bit more than one and a quarter percent. European indexes are broadly lower; the Footsie is currently down about 1.1% and the Dax is off by a half percent. US stock futures are down about a third of a percent.

*China has again raised the required reserve ratio for commercial banks; the fifty basis point increase now means that the major banks need to have a minimum of 19% of their deposits on reserve, the smaller banks are still required to retain 15.5%.

*The final December reading of Germany’s Consumer Price Index were unrevised at +1.2% month on month and +1.9% annualized.

*The December reading of Switzerland’s Producer and Import Prices Index was up 0.3% for the month and for the year on year result; both readings were two tenths more than forecast.

*The December reading of the UK Producer Price Index showed the cost of goods at the factory gate to be +0.5% month on month, one tenth higher than expected.

*JP Morgan reports Q4 eps of +$1.12, above the estimate for +$1.00; revenues were $26.1 billion also above the estimate for $24.22 billion.

*The December reading of the Consumer Price Index is due out at 7:30am CST. Headline CPI is expected to rise 0.4% on a month on month basis and the estimate for the CPI Core +0.1% from the month before; the forecasts for the annualized rates are +1.3% and +0.8% respectively. (I will note that absent a revision to previous months, it is my opinion that if the monthly reading on the CPI Core comes in at +0.1%, as is expected, the annualized rate will only be +0.6%.) Also due out at 7:30am is the December reading of Retail Sales; headline Sales is expected to be up 0.8% from the month before and Sales ex-autos are forecast to be +0.7% month on month. The December readings of Industrial Production and Capacity Utilization are due out at 8:15am CST. Production is forecast to increase 0.5% on the month and Capacity is expected to rise four tenths from the month before to 75.6%. The preliminary January reading of consumer sentiment from the University of Michigan is due out at 8:55am CST, it is expected to be 75.5, up one point from December. The November reading of Business Inventories is due out at 9:00am CST, it is expected to be +0.7% on the month.

*The Fed is scheduled to buy Treasuries today that are due to mature between 1/31/15 and 6/30/16; the results of the operation will be announced just after 10:00am CST.

*There are a couple of Fed speakers on the calendar today. Richmond Fed boss Lacker will talk about the US economic outlook at 11:45am CST and Boston Fed’s Rosengren is set to speak at an expo on mortgages at 12:15pm CST.

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