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Aug 26 - Turnaround Tuesday as China Cuts Rates

EMOTION MOVING MARKETS NOW: 3/100 EXTREME FEAR

PREVIOUS CLOSE: 3/100 EXTREME FEAR

ONE WEEK AGO: 14/100 EXTREME FEAR

ONE MONTH AGO: 10/100 EXTREME FEAR

ONE YEAR AGO: 34/100 FEAR

Put and Call Options: EXTREME FEAR During the last five trading days, volume in put options has lagged volume in call options by 10.17% as investors make bullish bets in their portfolios. However, this is still among the highest levels of put buying seen during the last two years, indicating extreme fear on the part of investors.

Market Volatility: EXTREME FEAR The CBOE Volatility Index (VIX) is at 36.02 and indicates that investors remain concerned about declines in the stock market.

Stock Price Strength: EXTREME FEAR The number of stocks hitting 52-week lows is slightly greater than the number hitting highs and is at the lower end of its range, indicating extreme fear.

PIVOT POINTS

EURUSD | GBPUSD | USDJPY | USDCAD | AUDUSD | EURJPY | EURCHF | EURGBPGBPJPY | NZDUSD | USDCHF | EURAUD | AUDJPY 

S&P 500 (ES) | NASDAQ 100 (NQ) | DOW 30 (YM) | RUSSELL 2000 (TF) Euro (6E) |Pound (6B)

EUROSTOXX 50 (FESX) | DAX 30 (FDAX) | BOBL (FGBM) | SCHATZ (FGBS) | BUND (FGBL)

CRUDE OIL (CL) | GOLD (GC)

 

MEME OF THE DAY – IT’S THE JERKS

 

UNUSUAL ACTIVITY

KING vol pop to highs SEP 14 CALL ACTIVITY @$.20 2000+ Contracts

PFE NOV 38 CALLS block @$.24 on offer 19713 Contracts

HZNP SEP 30 CALLS block @$1.45 on offer 3900 Contracts

UNFI President and CEO Purchase 5,500  @$45.24

CMRX Director Purchase 1,000 @$47.38

More Unusual Activity…

 

HEADLINES

 

Turnaround Tuesday as China cuts rates

PBOC cuts rates by 25 bps, RRR by 50 bps

PBOC: Economy still facing downwards pressure

China Premier Li: We have the ability to hit annual economic targets

China Premier Li: No Basis For Continued CNY Depreciation

Questions over Li Keqiang's future amid China market turmoil --FT

US CBO improves deficit view, sub-2% PCE seen to mid-2017

Fed Discount Rate Mins: 5 Fed banks vote for discount rate hike, 6 vote to hold, 1 votes for cut

US Consumer Confidence Index Aug: 101.5 (Est 93.4; Rev Prev 91.0)

US New Home Sales Jul: 507k (Est 510k; Rev Prev 481k)

US New Home Sales (MoM) Jul: 5.40% (est 5.80%; rev prev -7.70%)

US FHFA House Price Index (MoM) Jun: 0.20% (Est 0.40%, prev 0.40%)

US Richmond Index Aug: 0 (est 10; prev 13)

ECB Constancio: ECB ready to act if inflation outlook changes materially

ECB Constancio: European stocks are 'fairly valued'

 

GOVERNMENTS/CENTRAL BANKS

Fed Discount Rate Mins: Five Fed banks renew calls for discount rate hike

Fed Discount Rate Mins: Minneapolis Fed again votes to cut discount rate by 25bps

Fed Discount Rate Mins: Six banks voted to hold discount rate

US CBO improves deficit view, sub-2% PCE seen to mid-2017 --MNI

FED COMMENT: Summers, Dalio raise prospect of QE4 from the Fed --FT

BoC Schembri: Canada macroprudential housing policy is working --BBG

ECB Constancio: ECB ready to act if inflation outlook changes materially --Rtrs

ECB Constancio says European stocks are 'fairly valued' --FT

ECB: E949.0m borrowed using overnight loan facility --Livesquawk

ECB: E162.3bn deposited overnight --Livesquawk

Ifo economist: China to be bigger factor for German business --Rtrs

Japanese PM Advisor Hamada: BoJ should consider acting if yen rises sharply --WSJ

Senior Japan ruling party member Toshihiro Nikai calls for fiscal spending amid stocks rout --ET

Swiss parliament panel grills SNB's Jordan on negative rates impact --Rtrs

CHINA

China cuts RRR ratio by 50 bps to 18%, effective 6 Sept --BBG

China cuts 1yr deposit rate and lending rate by 25 bps each --BBG

PBOC Removes fixed deposit rate ceiling for more than 1yr --BBG

PBOC: Economy still facing downwards pressure --BBG

PBOC: Cuts will provide long term liquidity --BBG

PBOC gauges MLF demand this week --BBG

China Premier Li: We have the ability to hit annual economic targets --MNI via ForexLive

China Premier Li: No Basis For Continued CNY Depreciation --MNI via ForexLive

Questions over Li Keqiang's future amid China market turmoil --FT

Germany EcoMin Gabriel: German economy has no fear for Chinese turmoil -ForexLive

France EcoMin Macron: China poses risks to global economic recovery --ForexLive

FIXED INCOME

US sells 2-year notes to tepid demand --Rtrs

Fed RRP $73.2bn, 32 bidders (prev $73.8bn, 32 bidders) --Livesquawk

Bund hit after China rate cut lessens need for safety --FT

UK DMO to sell £3.75bn 1.5% 2021 gilt on 2/Sept --Livesquawk

Eonia settles at -0.135% (prev -0.126%) --Livesquawk

FX

USD: Dollar recovers against euro, yen --MW

EUR: French EconMin Macron: China developments to push up EUR, may 'handicap' policymakers --ForexLive

EUR COMMENT: The Euro Emerges as Unlikely Safe Haven --BBG

JPY: Japanese PM Advisor Hamada: BoJ should consider acting if yen rises sharply --WSJ

GBP: Pound bounces back against the euro despite predictions that China crisis could delay UK rate rises --Daily Mail

ENERGY/COMMODITIES

CRUDE: WTI futures settle 2.8% higher at $39.31 per barrel --Livesquawk

 

MARKETS: Commodity prices pushed higher after China cut --FT

CRUDE: Oil rallies but still near six-and-a-half-year lows --Rtrs

CRUDE: Iran's oil investments shrink on crude slump --BBG

CRUDE COMMENT: Opec 'feels the heat' on oil, but will it cut? --CNBC

CRUDE: BP restarts large crude distillation unit at Whiting --BP

METALS: Trafigura to exit LME's metals storage business --FT

METALS: EU antitrust regulators are probing precious-metals trading following a US investigation --BBG

EQUITIES

MARKETS: US stocks soar at open after market tumult --FT

POLICY: ECB's Constancio says European stocks are 'fairly valued' --FT

M&A: Nippon Life to pay Y300-Y400bn for Mitsui Life --Nikkei via BBG

M&A: Monsanto ups bid for Syngenta --CNBC

EARNINGS: Best Buy shares soar after earnings beat --CNBC

O&G: BHP Billiton posts worst profit in 11 years, maintains dividend --SMH

INDUSTRIALS: Boeing looks through turbulence with rosy China view --FT

FX: GE will seek compensation for FX loan conversion in Poland --BI

CRA: S&P: United Technologies Corp. Ratings Affirmed Following Announcement Of Sikorsky Sale And Share Buybacks

EMERGING MARKETS

CHINA: Shanghai Comp closed down 7.6% before (before PBOC cut rates) --BBC

 

RUSSIA: Russia Cuts 2015 Outlook But Sees Growth In 2016 --MW