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China’s Largest Trade Deficit in 7 Years + Spain’s Downgrade Give Way to Weakest Premarket Activity This Week

HedgeFundLIVE.com – Morning Notes

- Weakest premarket activity this week
- Global markets are down on negative macro news items
- Starting with China- trade balance came in much worse than expected and showed a deficit, which was largely unexpected; note that this $7.3B deficit is the largest that this figure has been in seven years
- In Japan, Q4 final GDP came in weaker than expected, -1.3%
- Japan revised Q4 GDP down
- Bank of Korea hiked rates by 25bps, expected
- Asian markets closed down notably with the Shanghai and Nikkei both down 1.5%
- New Zealand cut rates
- China CPI number will be released tonight (US time) and this figure is one to keep an eye out for
- Spain was downgraded one notch by Moody’s, adding to pressure to European markets
- Note that bunds initially spiked on Spain’s downgrade news
- UK trade balance came in better than expected
- German trade balance came in worse than expected
- Oil seeing a bit of a pullback this morning
- S&P futures are down nonetheless, about 9 handles from FV ahead of the bell
- In the Middle East, reports that Gaddafi may agree to talks about potential transition of power; meanwhile, fighting continues in Libya; continued bombing of oil port town, Brega
- Gold and silver are lower this morning
- Jobless Claims: 397K vs. 376K; prior revised up to 371K from 368K
- Continuing Claims dropped to 3.771M from 3.791M
- January Trade Balance: -$46.3B vs. -$41.5B; prior revised up to -$40.3B from -$40.6B
- Futures pulling in following claims number
- On tap for rest of today: Treasury Monthly Budget Statement is out at 2p
- Treasuries seeing bit of a bid as equities are weak this morning
- Macroeconomic numbers finally surfacing and hitting the markets