United Kingdom

Submitted by Saxo Bank's Martin O'Rourke via TradingFloor.com,

What started off in familiar fashion, with Asian stocks rising, and Europe hitting multi-month highs and US futures in record territory has stumbled in recent minutes following a continued rush for safety in short-dated German Bunds (the 2Y is now trading at -0.92%) and ongoing selling in the USDJPY, which has pushed Stoxx 600 back to unchanged, and S&P futures to modestly red for the session.

The exact  catalyst is unclear although traders are citing continued French political risks, as the recent OAT selloff continued this morning on Le Pen fears.

Despite US markets being closed in observance of Washington's birthday, S&P futures spiked during overnight trading, reaching new all time highs before fading some of the gains. Both Asian and European markets traded modestly higher after paring early gains. The U.S. dollar traded in a tight range ahead of a busy week for Federal Reserve events, while the pound rallied the most in more than two weeks ahead of a House of Lords Brexit debate, while South Africa’s rand fell on political turmoil. Oil advanced for a third day and spot gold rose for the fourth session in five.

In a fiery speech delivered in London aimed to show U.K. Prime Minister Theresa May that she won’t get everything her own way, former British Prime Minister Tony Blair Tony Blair urged opponents of Brexit to “rise up” and fight to change the British people’s minds about leaving the European Union. 

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S&P equity futures followed Asian and European stocks lower, driven by weakness in Franch and Italian markets, as French political concerns returned; the pound tumbled after UK monthly retail sales unexpectedly dropped pushing the dollar higher and Euro lower.