Dow+1.27% S&P +1.22% Nasdaq+0.92% Russell +0.80% Vix @13.97 -10.79%
US Market closed Higher on FOMC Meeting. Fed chair Yellen wrongfooted investors positioned for a hawkish removal of the "patient" language from today's policy statement with a substantially more dovish tilt, reduction of GDP forecasts, tempered projections for the pace of policy normalization, and more vocal worries over stronger USD. Macro positions of higher USD and treasury yields, lower precious metals, and volatile equity markets building for the past few weeks saw a violent reversal - Dow Industrials spiked up over 200pts to hit a 1-week high of 18,100, EUR/USD zoomed nearly 4 big figures as high as 1.10 handle, USD/JPY fell over 150pips below 119.50, yield on the 10-yr bench mark slid nearly 15bps toward 1.90%, and gold spiked up over $25 above $1,175 all in the immediate aftermath of the Fed surprise. the Fed removed the "patient" component in the third paragraph of its statement pertaining to its intentions for normalizing policy. But it inserted a vague precondition of "reasonable confidence" for inflation to return to 2% objective, while also adding economic activity has moderated (from solid), export growth has weakened (from growing), and deemed market-based inflation indicators remaining low. All other components of the statement - improved labor market, moderately rising household spending, slow property market recovery, and balanced risks for activity and labor - were left unchanged. FOMC staff projections lowered 2015 and 2016 GDP midpoint to 2.5% from 2.8% and 2.75% respectively, and the median call for 2015-end fed funds rate was scaled back all the way to 0.625% from 1.175%. 2016 median was set lower by 62.5bps at 1.875% and that of 2017 lower by 50bps at 3.125%. At the accompanying press conference, Yellen added the removal of "patient" language does not mean Fed will be impatient, falling prices have restrained inflation, and that strong dollar is among the reasons for weaker export growth and low inflation expectations.Outside the post-Fed volatility, sentiment in the Asia session has been largely consolidative. EUR/USD retreated below $1.08 and AUD/USD below $0.7750, while lower USD/JPY weighed on Tokyo and traded in a 60pip band around ¥121 level.China property space retaining key economic risks and limited scope of policy response from Beijing, intent on continued deleveraging.In Europe, Greece was in the headlines yet again, as local press reported the outflows from the banking system on Wednesday spiked up to €350-400M - 5x higher than previous days' average. Greek Deputy PM said liquidity is becoming a problem just three days after PM Tsipras said the exact opposite, and Athens request for ELA increase of €900M this week was only met with about €400M allotment.
Nikkei-0.35% Hang Seng +1.04% Shanghai +0.2%
RUB $59.5043 (Lowest levels since rebound in mid Jan.) WTI $43.48 Brent $55.32 EURCHF 1.0689 CHF 0.9911
EUR$ 1.0786 S&P +0.24% EuroStoxx-0.06% Dax-0.25% SMI+0.1%
Macro :
- Greek Bank Deposits Outflow Spikes: Ekathimerini
- ECB Said to Increase ELA Ceiling for Greek Banks by EU400m
- Asset Prices ‘Becoming Bubbly,’ Certainly in EU Bonds: Gross
Keep an eye on :
- A3M SM : Citigroup sold 3.2% stake in the Co @€13.35 (vs €13.90 -3.96% discount)
- AIR FP : Airbus Insider Trading Trial Blocked by French Court: FT
- AIR FP : Philippines Took Delivery of First of 3 Transport Planes: Airbus
- AIR FP : Airbus Said to Seek $700m From Skymark for A380 Cancellations
- BEN IM : Benetton Family May Delay Search for New ADR Shareholder: MF
- BMW GY : BMW 3-Series Hybrid Models to Use Samsung SDI Batteries: Yonhap
- BOSS GY : Hugo Boss attracts attention of major private equity firms (Kering Mentionned)- Carlo Festa Blog
- FRA GY : Fraport Forecasts 2015 Ebit EU500m-EU520m vs EU483m in 2014
- ENEL IM : Enel 2014 Adj. Net Income Beats; Dividend Above BDVD Forecast, Enel Boosts Div. Policy to 65% Payout in 2018 From Current 50%
- HEI GY : HeidelbergCement 2014 Profit Drops, Sees Significant 2015 Rise
- INM ID : *INDEPENDENT NEWS & MEDIA SELLS 180M SHRS IN APN: AFR (APN AU)
- ITP FP : Interparfums Buys Rochas From Procter & Gamble for $108M: Figaro
- KGX GY : Kion 2014 Net Income Rises 29%; Dividend Proposal Beats Forecast
- KRN GY : Krones 2014 Profit Rises, Dividend Matches BDVD Projection
- LG FP : Holcim-Lafarge Talks Said to Progress on Terms of Merger
- LXS GY : Lanxess Sees 2015 Ebitda Pre-Items at About Same Level as 2014
- LHA GY : Lufthansa Germany Strike Extended to Friday, Union Says
- PC IM : Pirelli May Be Taken Over by New Investors, Corriere Says
- SAN FP : Sanofi’s Lyxumia No Worse Than Placebo for Heart Safety: Study
- SOP FP : Sopra Steria Posts 2014 Profit of EU92.8m, Plans Div. EU1.90
- SYNN VX : Syngenta Made Progress on 2020 Targets Across All 6 Commitments
- UHR VX : Swatch’s Longines Sales Reached CHF1.5b Last Year, AWP Says
- VOLVB SS : Volvo CEO Persson May Leave Job Soon, Dagens Industri Reports