OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ17 +0.11%) this morning are up +0.03% and European stocks are up +0.12% as strength in energy stocks lifts the overall market. Energy stocks caught a bid after Jan WTI crude oil (CLF18 +1.72%) rallied +1.69% to a new 2-1/3 year high when the API reported late Tuesday afternoon that U.S. crude supplies last week fell -6.36 million bbl. European stocks also found support on upbeat comments from ECB Executive Board member Coeure said: “the economic environment is improving, price pressures are building up and we’ve become less reliant on our monthly net asset purchases.” Asian stocks settled higher: Japan +0.48%, Hong Kong +0.62%, China +0.59%, Taiwan +0.40%, Australia +0.38%, Singapore +0.19%, South Korea +0.59%, India +0.25%. China’s Shanghai Stock Index posted a 1-week high as Asian markets moved higher on carry-over support from the rally in the S&P 500 on Monday to a new record high.

The dollar index (DXY00 -0.09%) is down -0.14% after Fed Chair Yellen signaled the pace of Fed tightening will be slow and gradual when she said, “removing policy accommodation too quickly risks leaving inflation below our target”. EUR/USD (^EURUSD) is up +0.09%. USD/JPY (^USDJPY) is down -0.32%.

Dec 10-year T-note prices (ZNZ17 -0.04%) are down -1.5 ticks.

ECB Executive Board member Coeure said, “the economic environment is improving, price pressures are building up and we’ve become less reliant on our monthly net asset purchases.” He said he expects “interest rate guidance to gain importance over time, up to a point where” it would be possible to delink it from the end of net asset purchases.

Fed Chair Yellen said, “removing policy accommodation too quickly risks leaving inflation below our target” and there had been “some hint” that expectations for future price increases may be drifting down. “On the other hand, removing policy accommodation too slowly also has risks and the labor market could tighten very quickly.”

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