OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 +0.03%) are up +0.03% at a fresh all-time nearest-futures high and European stocks are up +0.22% at a 13-month high as global equity markets continue this week’s rally on expectations of stronger economic growth and government spending by the Trump administration. Stronger-than-expected UK Q4 GDP was positive for European stocks along with increased M&A activity that has also given a boost to European drug and healthcare companies after Johnson & Johnson acquired Swiss drug maker Actelion Ltd, for $30 billion. The rally in global stock prices has reduced demand for gold as a safe-haven with Feb COMEX gold (GCG17 -0.69%) down -0.47% at a 1-1/2 week low, and has also led to selling of government bonds as the 10-year German bund yield climbed to a 1-year high of 0.499% and Mar 10-year T-notes tumbled to a 4-week low. Asian stocks settled higher: Japan +1.81%, Hong Kong +1.41%, China +0.31%, Singapore +0.39%, South Korea +0.87%, Taiwan, Australia and India all closed for holiday. China’s Shanghai Composite and Japan’s Nikkei Stock index both rose to 2-week highs on optimism the Trump administration’s’ pro-growth policies will boost the global economy.

The dollar index (DXY00 +0.19%) is up +0.16%. EUR/USD (^EURUSD) is down -0.18%. USD/JPY (^USDJPY) is up +0.90%.

Mar 10-year T-note prices (ZNH17 -0.10%) are down -3.5 ticks at a 4-week low.

UK Q4 GDP rose +0.6% q/q and +2.2% y/y, stronger than expectations of +0.5% q/q and +2.1% y/y, but unchanged from Q3.

German Feb GfK consumer confidence rose +0.3 to 10.2, stronger than expectations of +0.1 to 10.0 and the highest in 5 months.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly initial unemployment claims (expected +13,000 to 247,000, previous -15,000 to 234,000) and continuing claims (expected -6,000 to 2.040 million, previous -47,000 to 2.046 million), (2) Dec wholesale inventories (expected +0.1% m/m, Nov +1.0% m/m. Dec retail inventories, Nov +1.0% m/m), (3) Dec Chicago Fed national activity index (expected +0.22 to -0.05, Nov -0.22 to -0.27), (4) Jan Markit services PMI (expected +0.5 to 54.4, Dec -0.7 to 53.9), (5) Dec new home sales (expected -0.8% to 587,000, Nov +5.2% to 592,000), (6) Dec leading indicators (expected +0.5%, Nov unch) (7) Jan Kansas City Fed manufacturing survey (expected -3 to 8, Dec +10 to 11), (8) Treasury auctions $28 billion of 7-year T-notes, (9) President Trump is scheduled to meet with House and Senate Republicans at their 3-day policy retreat in Philadelphia, (10) USDA weekly Export Sales.