Market Morning Huddle – Flight to Safety Continues – 9 Feb 2016

News Driver: U.S. stock index futures were lower on Tuesday. Investors continue to move to safer assets (flight to safety) amid increasing concerns of a sustained slowdown in global economic growth. Global markets were lower, led by a fall in European bank stocks.

S&P Futures: -1.1%
Nasdaq Futures: -1.5%
Dow Futures: -1.1%
Oil Futures: -0.8%

Today’s action is a WEAK FORM RISK OFF (higher risk assets being sold with money flows to defensive assets) that has better odds of the S&P 500 holding above 1,850-1,842 (support) into the close.

S&P 500: Pre-market the S&P 500 held flat to yesterday’s close until 6:30am EST then dropped down to intraday support yesterday -0.75%; currently down -1%. The Momentum indices are leading to the down-side (under-performing) with the Nasdaq –1.25% and the Russell 2K -1.45%.

TSX: under-perform into the open likely breaking support of 12,547-12,497 If you’re holding positions in the TSX be prepared for a re-trace to support of 12,345-12,300 -1.9% away

Bonds/Gold: Long duration bonds are dislocated and expensive relative to equities but still holding with TLT flat (+0.1%) to yesterday’s close (this adds to the weak-form risk-off tone, a strong bid to TLT would lean to strong-form). Gold was down -1% earlier this morning but now presents as flat to yesterday’s close, it is clearly decelerating under resistance of $1,202.5-$1,197. Gold is extended and more likely to pullback – wait for confirmation on the chart.

Oil: $29.50 (8:56am): Levels to watch are $29.38 support. Crude Oil was attempting a positive move earlier this morning but is currently down -1% at $29.50 below key support of $31.15-$30.50 which is now resistance.

Economic Calendar: API Weekly Crude Stock released at 4:35pm EST

For a review of the rest of today’s economic data visit the economic calendar here.

Earnings: Todays stock to watch are Disney $DIS, Coca Cola $KO and CVS Health Corp $CVS

For a complete list of today’s earnings visit the earnings page on our site.