Daily Kickstart (Dollar Doldrums)

Oh how the mighty (greenback) has fallen.

The consensus trade of 2017 is having a rough go of it following Wednesday’s Trump presser which offered little (if anything) in the way of details around the President-elect’s fiscal stimulus plans.

Of course that was easy to see coming – all anyone cared about was Russian hacking and the distinction between “fake” and “real” news. Well I’ve got some “real” news for you. The dollar is at YTD lows…

dollar

… which is giving some respite to the beleaguered peso and lira.

dollar2

As you can see, the yen is also stronger while gold and crude are getting a bump as well. In fact, gold is near seven week highs…

gold

“Trump made a couple references to ‘making America great again’ but there was no detail on infrastructure spending, corporate tax reform, personal income tax cuts, the prospects for deregulation or the possibility of another tax repatriation holiday,” Westpac Global said, summing things up rather succinctly in a note released on Thursday. I would submit that there were not details given because the administration is itself short on substance when it comes to actually implementing campaign trail promises.

In equities, the strong yen hit Japanese shares which fell more than 1%. Hong Kong, Australian, and Chinese bourses all ended lower.

  • MSCI Asia Pacific up 0.9% to 141
  • Nikkei 225 down 1.2% to 19135
  • Hang Seng down 0.5% to 22829
  • Shanghai Composite down 0.6% to 3119
  • S&P/ASX 200 down less than 0.1% to 5767

In Europe, screens were red as well with healthcare stocks leading the decline after Trump accused pharma of “getting away with murder” on Wednesday. 74% of Stoxx 600 members are lower.

  • Stoxx 600 down 0.4% to 363
  • FTSE 100 down 0.2% to 7273
  • DAX down 0.5% to 11582
  • German 10Yr yield down 1bp to 0.32%
  • Italian 10Yr yield up 1bp to 1.88%
  • Spanish 10Yr yield up less than 1bp to 1.42%
  • S&P GSCI Index up 0.8% to 398

Meanwhile, Treasurys gained and the dollar fell with 10Y yields hitting their lowest level since late November. Yields and the dollar have tracked each other very closely since the election:

dollaryields

US futs are lower as of this writing.

  • S&P 500 futures down 0.3% to 2264
  • Stoxx 600 down 0.4% to 363
  • MSCI Asia Pacific up 0.9% to 141
  • US 10-yr yield down 5bps to 2.32%
  • Dollar Index down 0.62% to 101.15
  • WTI Crude futures up 0.6% to $52.55
  • Brent Futures up 0.9% to $55.58
  • Gold spot up 1% to $1,204
  • Silver spot up 1.2% to $16.93
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