The Morning Hammer: Another Day, Another Yawn

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Yesterday after the close, the American Petroleum Institute reported a 2.1 million barrel increase in crude oil inventories, which is pushing oil prices down a bit overnight.

We have EIA inventories coming at 10:30 a.m. ET, with economists expecting a -1.5% million barrel drop. They also expect drops in Cushing, OK inventories and gasoline inventories.

We also have JOLTS Job Openings at 10:00 a.m.

The People's Bank of China said it will promote greater international use of the yuan, though the bank didn't promote much detail.

The dollar is down as traders believe the Fed will be less hawkish… ALLEGEDLY. That's the picture some outlets are painting, though I'm not buying it.

Fed Funds futures are now pricing in a 45% chance of a December rate hike, down from 47% last week. That's not much considering this number was 9% on June 27, just after the Brexit.

The reality is that Fed expectations can turn on a dime.

A few more hot economic data points and hawkish Fed head chatter, and it could go above 60-70%.

And of course, it could go to 30% just as easily.

Crude oil has climbed off overnight lows and that's pushed SPX futures into the green.

So we're back in the waiting game as the August doldrums continue.

Yesterday morning, I went long VIX calls, which means I'm effectively short the market in the near-term. (I also have long-term equity/HY exposure through AAPL, BGR, KYN, PHK, VIG, and UTF, none of which I would buy now, except for closed-end fund dividend reinvestments)

But for now, it looks like Mr. Market is quite happy to stay in this go-nowhere range.

Crude oil was saved from breaking $42, though the 10:30 a.m. inventory numbers could change that.

Also keep your eyes on the other usual suspects — the Russell 2000, biotech (IBB), and high-yield (HYG).

The bulls have done a great job of defending these key areas, so see if they can keep it it up.