Futures higher on strong Chinese data

ECB and BOE rate decision also in focus as are initial jobless claims.

By Benzinga Jan 10, 2013 9:15AM
zurbar age fotostockU.S. equity futures rose modestly in early Thursday trade following strong Chinese trade data as the European Central Bank and the Bank of England left rates unchanged.

Overnight, China reported that the trade balance was $31.6 billion in December, well ahead of consensus forecasts of a $20.0 billion trade balance. Also, exports grew at a 14.1% annualized rate, well faster than consensus expectations of a 5.0% rise. The report also showed strong signs of credit growth.

In other news, Spain sold 5.7 billion euros of two-, five-, and 13-year bonds with yields falling across the curve and on strong demand.

Italy sold 8.5 billion euros of one-year notes with yields falling and demand remaining strong as well. The yield was the lowest since January 2010 at the auction.

The Greek unemployment rate rose to 26.8% in October from an upwardly revised 26.2% in September showing that the Greek tragedy that is the debt crisis is not anywhere near over yet.
  • S&P 500 futures rose 4.2 points to 1,460.00.
  • The EUR/USD was higher at 1.3102.
  • Spanish 10-year government bond yields fell to 4.99%. This is the first time that 10-year yields fell below 5% since March of 2012.
  • Italian 10-year government bond yields fell to 4.192%.
  • Gold rose 0.42% to $1,662.50 per ounce.
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Asian markets
Asian shares were higher overnight following the strong Chinese trade data as investors' fears over a collapse in global trade receded following the report. The Japanese Nikkei Index rose 0.7% in Tokyo while the Shanghai Composite Index rose 0.37% and the Hang Seng Index rose 0.59%. Also, the Korean Kospi jumped 0.75% and Australian shares rose 0.31%.

European markets
European shares were mostly higher in early trade and were rising following the strong auctions from Spain and Italy. The Spanish Ibex Index rose 0.15% overnight and the Italian MIB Index rose 0.63% following the strong auctions. Meanwhile, the German DAX rose 0.24% and the French CAC slipped 0.1% while U.K. shares rose 0.12% in early trade.

Commodities
Commodities were higher overnight led by energy futures on the back of the Chinese trade data. WTI crude futures rose 1.58% to $94.56 per barrel and Brent crude futures rose 1.23% to $113.15 per barrel. Copper futures rose 1.14% to $371.25 per pound as a stronger Chinese economy points to higher copper demand. Gold was higher and silver futures rose 0.95% to $30.54 per ounce.

Currencies
Currency markets were in risk-on mode on the back of the Chinese trade data and the strong European auctions. The EUR/USD was higher at 1.3102 and the dollar gained against the yen to 88.08. Overall, the Dollar Index fell 0.23% on weakness against the euro, the Canadian dollar, the Swiss franc and the Swedish krone. Also, the AUD/USD was demonstrably stronger overnight after the Chinese trade data and AUD/JPY was the best gainer, rising 0.82%.

Premarket movers
Stocks moving in the premarket included:
  • Corning (GLW) shares rose 2.02% premarket after the company announced at CES that it is working with TV manufacturers to create large panels of Gorilla Glass for large appliances.
  • Microsoft (MSFT) shares fell 0.75% premarket after the company announced a new partnership with Sprint (S) to launch Windows smartphones on Sprint's network. (Microsoft owns and publishes Top Stocks, an MSN Money site.)
  • Newmont Mining (NEM) shares rose 0.42% premarket as gold prices rallied sharply.
  • Caterpillar (CAT) shares rose 0.38% premarket following the strong Chinese data.
Earnings
Companies expected to report Thursday:
  • MSC Industrial Direct (MSM) is projected to report its Q1 earnings at $1.01 per share on revenue of $582.26 million.
  • Supervalue (SVU) is expected to report its Q3 earnings at $0.06 per share on revenue of $7.90 billion.
  • Ceres (CERE) is estimated to post a Q1 loss at $0.32 per share on revenue of $1.33 million.
  • Xyratex (XRTX) is projected to post a Q4 loss at $0.32 per share on revenue of $255.18 million.
Economics
On the economics calendar Thursday, initial jobless claims and wholesale trade are due out. In addition, the Treasury is set to auction 30-year bonds. Esther George of the Kansas City Fed, James Bullard of the St. Louis Fed and Narayana Kocherlakota of the Minneapolis Fed are set to speak during the day.

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