So Whatcha Got for Us Super Mario? – T3 Live
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So Whatcha Got for Us Super Mario?


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Good morning! My opening column normally posts later, but I wanted to get in ahead of the ECB's rate decision at 7:45 a.m. ET and President Mario Draghi's press conference at 8:30 a.m.

Traders expect no change in any of the ECB's main rates or its 80 billion euros/month QE asset purchase program, but will be eager for Super Mario's commentary on the ECB's future strategy.

While UK economic data has actually generally exceeded expectations around the Brexit, retail sales dropped at the fastest rate in 6 months.

But the FTSE 100 is down just -0.3%, so it's not causing any real headaches.

The Nikkei is up 0.8% this morning as Bank of Japan governor said there is no need for “helicopter money.” Traders have been speculating that the BoJ may increase its stimulus package, and thus the yen is strengthening a bit this morning.

We had some big semi earnings. Qualcomm (QCOM) delivered strong numbers and guidance despite fears it is losing business with Apple (AAPL).

Qualcomm is indicated up huge.

Meanwhile, Intel (INTC) is taking a breather on PC market weakness. I'll update my calendar spread trade idea after the open. Given how insanely jacked implied volatility was into the report, that position may be just fine, but we'll see how things shake out.

On the deal front, construction equipment giant Komatsu is acquiring Joy Global (JOY) for $2.9 billion, a  20% premium to Joy's close yesterday. This is a gutsy move by Komatsue, but should commodities prices see a continued rise, it will be a home run.

Yesterday, the VIX hit a 2016 low at 11.40, and is hovering around 12 this morning.

And with the 3-month VIX curve at +6.41, traders are pricing in almost no-near term danger, which makes sense given this slow-motion upward grind.

Here are 2 charts worth looking at:

1) The 3-month VIX curve vs. the S&P 500 YTD

2) The VIX curve vs. 1 month ago, just ahead of the Brexit

Suffice it to say that US investors have long forgotten about the Brexit, and many continue to see blue skies ahead.

Other sentiment measures are a bit mixed, though overall, sentiment definitely seems bullish while market technicals appear stretched.

Typically, that's a good combination for a sideways grind.

And as it stands now, US stock futures are as flat as an ironing board.

So let's see if the ECB changes anything.

We've also got a decent chunk of data on tap, with Chicago Fed, Jobless Claims, Philly Fed, FHFA House Price, Existing Home Sales, and the Leading Index numbers coming.

Good luck friends.