OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 +0.37%) are up +0.28% and European stocks are up +0.89% at an 11-1/4 month high. A rally in Italian bank stocks is leading European equities higher after UniCredit SpA, Italy’s biggest bank, climbed over 7% when it said it plans to raise 13 billion-euros ($13.8 billion) in a rights offer, sell off its bad loans, and cut 6.500 more jobs in an attempt to boost profits. A +0.74% gain in Jan WTI crude oil (CLF17 +0.78%) is also giving energy producing stocks a lift as well after the IEA predicted that the global energy market will move from surplus into deficit in the first half of 2017 if OPEC and other producers follow through on their agreement to cut production. The IEA had previously predicted that the global oil market would be in surplus until the end of 2017. Asian stocks settled mostly higher: Japan +0.50%, Hong Kong +0.06%, China +0.07%, Taiwan +0.34%, Australia -0.32, Singapore +0.10%, South Korea +0.35%, India +0.69%. China’s Shanghai Composite rebounded from a 1-month low and closed higher after consumer staple companies rallied when data showed China Nov retail sales posted their biggest gain in 11 months.

The dollar index (DXY00 +0.03%) is up +0.10%. EUR/USD (^EURUSD) is down -0.22%. USD/JPY (^USDJPY) is up +0.29%.

Mar 10-year T-note prices (ZNH17 +0.15%) are up +3.5 ticks.

The German Dec ZEW survey expectations of economic growth was unchanged at 13.8, weaker than expectations of +0.2 to 14.0.

China Nov retail sales rose +10.8% y/y, stronger than expectations of +10.2% y/y and the biggest increase in 11 months.

China Nov industrial production rose +6.2% y/y, stronger than expectations of +6.1% y/y.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Nov import price index (expected -0.4% m/m and unch y/y, Oct +0.5% m/m and -0.2%y/y), (2) FOMC begins 2-day policy meeting, and (3) the Treasury auctions $12 billion of 30-year T-bonds.