Authored by Saxobank CIO Steen Jakobsen, via TradingFloor.com,
No wonder David Cameron looks worried.
The overnight news was decidedly downcast, with first London mayor Boris Johnson voicing his support for Brexit leading to a collapse in the pound, validating our Saturday warning and then some, resulting in the biggest drop in cable in over a year over fears that the EU will lose one of its most critical members...
"I was here till 5 o'clock this morning working through this and we've made some progress but there's still no deal.”
That’s from British PM David Cameron, who was apparently up all night in an effort to understand why his country should stay in the EU. Unless Cameron hears what he wants to hear, he will not campaign for the UK to remain in the bloc ahead of an expected referendum on membership in June.
Just when traders thought that the biggest and most violent 3-day short squeeze in 7 years was about to end...
... a squeeze that has resulted in 3 consecutive 1%+ sessions for the S&P for the first time since October 2011, overnight we got one of the Fed's biggest faux-hakws, St. Louis Fed's Jim Bullard, who said that it would be "unwise" to continue hiking rates at this moment, and hinted that "if needed", the most natural option for the Fed going forward would be to do further Q.E.
One day after markets saw a violent return of optimism, which sent stocks around the globe and US equity futures soaring (the US was closed for President's Day) driven by terrible Japanese and Chinese economic data which in turn hinted at more central bank easing, animal spirits have cooled off despite some truly unprecedented Chinese credit numbers.