OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH18 +0.07%) this morning are up +0.03% and European stocks are higher by +0.15% as gains in energy stocks lead the overall market higher. Jan WTI crude oil (CLF18 +0.83%) is up +0.62% at a 1-week high on carry-over support on a rally in Brent crude prices to a 2-1/2 year high of $65.75 a barrel. Brent crude continues to surge on supply concerns after the Forties Pipeline System, which carries 400,000 bbl of oil a day, was shut down due to a crack in one of the pipelines. The shutdown of the pipeline will last two weeks until repairs are made, and it forced Apache to suspend operations at its nearby Forties oil field. Gains in European stocks were limited after the German Dec ZEW survey expectations of economic growth fell more than expected. Asian stocks settled mostly lower: Japan -0.32%, Hong Kong -0.59%, China -1.25%, Taiwan -0.28%, Australia +0.25%, Singapore +0.15%, South Korea -0.31%, India -0.68%.

The dollar index (DXY00 -0.04%) is down -0.02%. EUR/USD (^EURUSD) is up +0.07%. USD/JPY (^USDJPY) is down -0.11%.

Mar 10-year T-note prices (ZNH18 -0.01%) are down -0.5 of a tick ahead of the 2-day FOMC meeting which begins later this morning.

The German Dec ZEW survey expectations of economic growth fell -1.3 to 17.4, weaker than expectations of -0.7 to 18.0. The Dec ZEW survey current situation unexpectedly rose +0.5 to a 6-1/2 year high of 89.3, stronger than expectations of -0.1 to 88.7.

UK Nov CPI of +0.3% m/m and +3.1% y/y was stronger than expectations of +0.2% m/m and +3.0% y/y with the +3.1% y/y gain the largest year-on-year increase in 5-1/2 years. The Nov core CPI rose +2.7% y/y, right on expectations.

Japan Nov PPI rose +0.4% m/m and +3.5% y/y, stronger than expectations of +0.2% m/m and +3.3% y/y, with the +3.5% y/y gain the largest year-on-year increase in 3 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Nov PPI final demand (expected +0.3% m/m and +2.9% y/y, Oct +0.4% m/m and +2.8% y/y) and Nov PPI ex food & energy (expected +0.2% m/m and +2.4% y/y, Oct +0.4% m/m and +2.4% y/y), (2) FOMC begins 2-day policy meeting, (3) USDA Dec WASDE crop production, (4) Treasury auctions $12 billion of 30-year T-bonds, (5) Nov monthly budget statement (expected -$135.0 billion, Oct -$63.2 billion).