It was revealed yesterday that none of the FOMC’s voting members thought additional stimulus was necessary, killing some hopes for a QE3. Overnight, the market further digested the news, selling off equity markets, crude, metals, and buying the US$.
S&P front-month-futures are lower by 11 handles (0.8%) and back below 1,400. DJIA futures are off 0.75%, but holding above 13,000. Crude futures lost 1% overnight, while Gold dropped 2.7% to $1,627.50 p/ounce. Of note, the 10-year and 30-year bond futures are holding steady, higher by 0.2% at the moment.
Yesterday, a shareholder filed a lawsuit against Groupon (GRPN) alleging it mislead investors with its financial results. Shares are another 1.5% lower in premarket activity.
EUR/USD is two handles lower from pre-minutes, falling from 1.3340 to 1.3130 at present. USD/JPY, which moved higher in the immediate wake of the minutes, has sunk back to 82.30. This “risk-off” environment should also see the CBOE Volatility Index (VIX) spike higher. VXX, an ETF tracking the VIX, is indicated 3.25% higher in premarket.
This morning, the ECB left interest rates unchanged at 1%. ECB President Mario Draghi will hold a press conference at 8:30 a.m. ET to discuss where rates might go in the future. ADP Employment was released, showing private sector job growth of 209,000 in March, led by gains in service-sector jobs. The Labor Department will issue its jobs figures on Friday at 8:30 a.m. ET. Later this morning, ISM Non-manufacturing is released at 10 a.m. ET, and EIA weekly petroleum inventories hit the wire at 10:30 a.m.