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 Post subject: October 2nd Thursday Trade Results - Profit $2990.00
PostPosted: Thu Oct 02, 2014 11:20 pm 
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Joined: Sat Jan 10, 2009 1:06 pm
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Location: Canada
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Trade Results of M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Price Action Trading (no technical indicators)
Phone: +1 708 572-4885
Free Chat Room: http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164
Business Hours: 8am - 5pm est (Mon - Fri)
questions@thestrategylab.com (24/7)
http://twitter.com/wrbtrader (24/7)

Attachment:
100214-wrbtrader-Price-Action-Trading-PnL-Blotter-Profit+2990.00.png
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click on the above image to view today's performance verification

Price Action Trade Performance for Today: Emini TF ($TF_F) futures @ $2,990.00 dollars or +29.90 points, Emini ES ($ES_F) futures @ $0.00 dollars or +0.00 points, Light Crude Oil CL ($CL_F) futures @ $0.00 dollars or +0.00 points, Gold GC ($GC_F) futures @ $0.00 dollars or +0.00 points and EuroFX 6E ($6E_F) futures @ $0.00 dollars or +0.0000 ticks. Total Profit @ $2,990.00 dollars

Russell 2000 Emini TF Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ The ICE
S&P 500 Emini ES Futures: 1 tick or 0.25 = $12.50 dollars and there's more contract information @ CMEGroup
Light Crude Oil CL (WTI) Futures: 1 tick or 0.01 = $10.00 dollars and there's more contract information @ CMEGroup
Gold GC Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ CMEGroup
EuroFX 6E Futures: 1 tick or 0.0001 = $12.50 dollars and there's more contract information @ CMEGroup

In addition, all of my trades were posted real-time in the timestamp ##TheStrategyLab chat room. You can read today's price action trading information about my trades (e.g. time, price entry, contract size, price exit) as the trade traversed to its completion. Also, sometimes I'll post real-time trading tips involving WRBs, WRB Hidden GAPs, Key Market Events (KME), Tutorial Chapters 2 & 3, WRB Zones, Reaction Highs/Lows, Contracting Volatility or Expanding Volatility. Its all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=135&t=1902

Quote:
If any of my real-time posted trades are via key concepts discussed in the WRB Analysis free study guide or the Fading Volatility Breakout (FVB) free trade signal strategy...I will discuss the reasons (trade strategy) behind those trades if/when a user of ##TheStrategyLab chat room ask questions about the trades. In contrast, real-time posted trades that are via the Advance WRB Analysis Tutorial Chapters 4 - 12 or the Volatility Trading Report (VTR) trade signal strategies...I discuss the reasons (trade strategy) behind those trades with fee-base clients in a different private chat room that's designated only for fee-base clients or discuss the strategies with fee-base clients on my Skype contact list.

Also, posted below are direct links to information about my price action trade methodology and trading plan (there's a difference between the two) that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body/bar analysis). I'm primarily a day trader because it suits my personal lifestyle but I do occasionally swing trade and position trade. Simply, my trade method is applicable for position trading, swing trading and day trading.

Image ##TheStrategyLab Chat Room is free. Members and I use the chat room to post WRB Analysis commentary, real-time trades and to post anything else related to trading. The chat room helps me tremendously in my own trading because I use it to document (journal) general volatility analysis involving WRB Analysis so that I can easily review at a later date my thoughts as I interacted with the markets...info I can not get from my broker statements. Also, this is not a signal calling chat room where a head trader tells you when to buy or sell and I do not have the time/energy/resources to manage a signal calling chat room. Access instructions for chat room @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164

Image Price Action Analysis via WRB Analysis Tutorials @ http://www.thestrategylab.com/WRBAnalysisTutorials.htm and there's a free study guide of the WRB Analysis Tutorial Chapters 1, 2 and 3 @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=119&t=718

Image Trade Signal Strategies via Volatility Trading Report (VTR) @ http://www.thestrategylab.com/VolatilityTrading.htm and there's a free trade signal strategy @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=89 so that you can freely test drive one of our price action trade strategies with support (answering your questions) prior to purchasing the Volatility Trading Report (VTR).

Image Trading Plan Daily Routine @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=248&t=2530

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Market Context Summaries

The below summaries by Bloomberg, CNNMoney, Reuters and Yahoo! Finance helps me to do a quick review of the fundamentals, FED/ECB/BOE/IMF actions or any important global economic events (e.g. Eurozone, MarketWatch.com) that had an impact on today's price action in many trading instruments I monitor during the trading day. Simply, I'm a strong believer that key market events causes key changes in supply/demand and volatility resulting in trade opportunities (swing points and strong continuation price actions) that reach profit targets. Thus, I pay attention to these key market events, intermarket analysis (e.g. Forex EurUsd, EuroFX 6E futures, Gold GC futures, Light Crude Oil (WTI) CL & Brent Oil futures, Eurex DAX futures, Euronext FTSE100 futures, Emini ES futures, Emini TF futures, Treasury ZB futures and U.S. Dollar Index futures) while using WRB Analysis from one trade to the next trade to give me the market context for price action trading before the appearance of my technical analysis trade signals. Therefore, I maintain these archives to allow me to understand what was happening on any given trading day in the past involving key market events to help better understand my trade decisions (day trading, swing trading, position trading)...something I can not get from my broker statements alone. Further, most financial websites remove (delete) their archives after a few years to make room for new content. Therefore, I maintain my own archives of the news content so that I have it available for me when financial websites no longer archives their content.

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click on the above image to view today's price action of key markets

4:10 pm: [BRIEFING.COM] The major averages ended the Thursday session on a flat note despite showing broad-based weakness in the early going. The S&P 500 ended unchanged with four sectors in the green.

Equity indices started the day near their flat lines, but commenced their retreat once European Central Bank President Mario Draghi concluded his press conference without providing much detail about the central bank's ABS purchases. Furthermore, Mr. Draghi did not hint at plans for sovereign bond purchases, which had been the subject of conversation in recent weeks. To that point, diminished prospects of a full-scale QE program weighed on markets in Italy (-3.9%) and Spain (-3.1%) with bank shares leading the retreat.

As for the U.S., equities slumped across the board in the morning, but staged an impressive reversal after reaching short-term oversold conditions just ahead of 12:00 ET. At that time, the S&P 500 hit its session low of 1925.93 and the TICK reading at the NYSE neared -1500-a level typically associated with excessive selling.

The major averages spent the afternoon in a steady rally back to their flat lines, but could not extend their advance past the unchanged mark. The discretionary sector (+0.4%) resisted the renewed pressure amid strength in apparel retailers and homebuilders. Heavyweight Nike (NKE 89.30, +1.60) jumped 1.8%, while the broader SPDR S&P Retail ETF (XRT 85.43, +1.10) rose 1.3%. As for homebuilders, the group rallied broadly with the iShares Dow Jones US Home Construction ETF (ITB 22.47, +0.20) climbing 0.9%.

Elsewhere among cyclical groups, the financial sector (+0.2%) outperformed throughout the session, while technology (+0.04%) displayed strength in the afternoon. Large cap names like Apple (AAPL 99.90, +0.72), Oracle (ORCL 38.27, +0.18), and Facebook (FB 77.08, +0.53) fueled the modest advance in tech, while chipmakers refused to take part. The PHLX Semiconductor Index lost 0.6%.

Similarly, the high-beta biotechnology group lagged with the iShares Nasdaq Biotechnology ETF (IBB 268.59, -0.84) sliding 0.3%. This pressured the health care sector (-0.2%), while the remaining countercyclical groups ended closer to their flat lines.

Treasuries slumped overnight, but tried turning positive during the morning retreat in stocks. However, the flat line served as resistance, resulting in new lows into the close. The 10-yr note fell 14 ticks, raising its yield five basis points to 2.44%.

Today's participation was ahead of recent averages with more than 780 million shares changing hands at the NYSE.

Economic data included initial claims, factory orders, and the Challenger Job Cuts report:

The weekly initial claims level fell to 287,000 from an upwardly revised 295,000 (from 293,000), while the Briefing.com consensus expected an increase to 297,000
According to the Department of Labor, there were no special factors impacting the initial claims
Over the past several weeks, the claims level has clearly moved from a 310,000 -- 320,000 trend to a sub-300,000 trend. These levels are typically associated with an economy at, or near, full employment, which would imply monthly payroll gains above 250,000
Factory orders fell 10.1% in August after increasing an unrevised 10.5% in July, while the Briefing.com consensus expected a decline of 9.3%
Led by strong demand for Boeing (BA 124.17, -0.50) aircraft, transportation orders increased 73.3% in July. Those gains were not sustainable and orders fell 42.2% in August, which brought orders back in-line with June levels. These severe up-and-down moves caused the biggest one-month increase and the biggest subsequent one-month decrease in overall manufacturing orders since data started being collected
Excluding transportation, factory orders declined a much more modest 0.1% in August, which was an improvement from a 0.7% decline in July
The September Challenger Job Cuts report revealed a 24.0% year-over-year drop to follow the previous reading of -20.7%

Tomorrow, the Nonfarm Payrolls report for September (Briefing.com consensus 210K) and the Trade Balance for August (consensus -$40.90 billion) will be released at 8:30 ET, while ISM Services for September (consensus 58.9) will cross the wires at 10:00 ET.

Nasdaq Composite +6.1% YTD
S&P 500 +5.3% YTD
Dow Jones Industrial Average +1.4% YTD
Russell 2000 -5.8% YTD

3:30 pm: [BRIEFING.COM] Dec gold traded in positive territory in early afternoon pit trade and touched a session high of $1219.50. However, it slipped back into the red and settled at $1215.00 per ounce, just 40 cents below the unchanged line.

Dec silver chopped around in negative territory and brushed a session low of $16.95. Unable to gain buying support, it settled with a 1.4% loss at $17.03 per ounce.

Nov crude oil spent most of today's floor trade in negative territory but trended higher after lifting from its session low of $89.26 per barrel set at pit trade open. The energy component broke into positive territory as it headed into the close and managed to settle with a 0.3% gain at $91.01 per barrel.

Nov natural gas fell for a third consecutive session as it sold off deeper into the red following EIA inventory data that showed a build of 112 bcf for the week ending Sep 26 vs expectations for a build of 107 bcf. Prices slipped as low as $3.91 per MMBtu despite touching a session high of $4.03 per MMBtu in early morning action. Unable to gain much momentum, natural gas settled 2.0% lower at $3.94 per MMBtu.

2:55 pm: [BRIEFING.COM] Equity indices hold modest gains with one hour remaining in the session. The stock market has not looked back ever since reaching short-term oversold conditions just before 12:00 ET. Only one sector-materials (-0.1%)-remain in negative territory at this juncture after being down as much as 1.1% at midday.

Despite the modest rebound, the S&P 500 is on track to enter the final session of the week with a 1.6% loss since last Friday. The benchmark index has performed in-line with the Nasdaq Composite, while the Russell 2000 has surrendered 1.7% so far this week.

Elsewhere, Treasuries have slid to fresh lows. The 10-yr note is lower by 13 ticks with its yield up five basis points at 2.43%.

2:25 pm: [BRIEFING.COM] The S&P 500 (+0.1%) has made its return into the green with six sectors now trading in positive territory. This leaves the materials sector (-0.4%) as the weakest performer, while the remaining laggards hold losses of no more than 0.3% apiece.

On the upside, the consumer discretionary sector (+0.2%) has received significant support from apparel retailers and homebuilders. The SPDR S&P Retail ETF (XRT 85.38, +1.05) trades higher by 1.3%, while the iShares Dow Jones US Home Construction ETF (ITB 22.45, +0.18) has added 0.9%.

Elsewhere, the technology space (+0.1%) also holds a modest gain, but chipmakers remain weak with the PHLX Semiconductor Index down 0.6%.

2:00 pm: [BRIEFING.COM] Equity indices hover just below their flat lines following a rally off the late morning lows. The S&P 500 trades lower by 0.2% after flirting with its flat line. However, the index has been unable to make a move into the green with the continued weakness among sectors like energy (-0.8%), industrials (-0.2%), and health care (-0.2%) acting as a drag.

Interestingly, the industrial sector has seen a divergence among transports and defense stocks. The Dow Jones Transportation Average is higher by 0.6% with 16 of its 20 components in the green, while the PHLX Defense Index is lower by 0.7% with just three names holding gains.

1:30 pm: [BRIEFING.COM] The major indices have all come bouncing back from much lower lows on a rally effort being attributed to a bounce from short-term oversold conditions.

The TICK reading at the NYSE was almost -1500 at 11:46 a.m. ET, which was essentially when the S&P 500 hit its low for the day at 1925.94 (TICK is a measure of the number of stocks trading on an uptick minus the number trading on a downtick. A reading below -1000 would be viewed by traders as a sign of excessive selling on an intraday basis).

The TICK reading was over +1100 a short time ago, reflecting the shift to strong buying interest after the early flush.

Notably, the Russell 2000, which was down 0.7% earlier, is now up 0.3%.

1:00 pm: [BRIEFING.COM] The major averages trade lower across the board at midday with the S&P 500 down 0.4%. The benchmark index has recovered roughly half of its losses, but all ten sectors remain in the red.

Equity indices spent the initial minutes of the session near their flat lines, but began slipping lower after European Central Bank President Mario Draghi reaffirmed the ECB's policy course but concluded his press conference without providing much detail about the central bank's ABS purchases. Furthermore, Mr. Draghi did not hint at plans for sovereign bond purchases, which had been the subject of conversation in recent weeks. To that point, diminished prospects of a full-scale QE program weighed on markets in Italy (-3.9%) and Spain (-3.1%) with bank shares leading the retreat.

Domestically, the S&P 500 financial sector (-0.3%) is the lone outperformer among cyclical groups. The sector held a slim gain in the morning, but gave in to the broad-based pressure when the market slipped into the red.

Elsewhere among cyclical sectors, energy (-1.1%) and materials (-1.1%) find themselves at the bottom of the leaderboard for the second day in a row. The energy sector hovers near its low and has widened its year-to-date loss to 2.0% even though crude oil trades little changed at $90.72/bbl after erasing its overnight loss. Similarly, a 0.5% pullback in the Dollar Index (85.55, -0.41) has failed to boost the sector.

On the countercyclical side, the health care sector (-0.5%) lags, while consumer staples (-0.1%), telecom services (-0.2%), and utilities (-0.1%) hover near their flat lines.

Treasuries continue holding losses after failing to turn positive during the past hour. The 10-yr note is lower by seven ticks with its yield up two basis points at 2.41%.

Economic data included initial claims, factory orders, and the Challenger Job Cuts report:

The weekly initial claims level fell to 287,000 from an upwardly revised 295,000 (from 293,000), while the Briefing.com consensus expected an increase to 297,000
According to the Department of Labor, there were no special factors impacting the initial claims
Over the past several weeks, the claims level has clearly moved from a 310,000 -- 320,000 trend to a sub-300,000 trend. These levels are typically associated with an economy at, or near, full employment, which would imply monthly payroll gains above 250,000
Factory orders fell 10.1% in August after increasing an unrevised 10.5% in July, while the Briefing.com consensus expected a decline of 9.3%
Led by strong demand for Boeing (BA 124.23, -0.44) aircraft, transportation orders increased 73.3% in July. Those gains were not sustainable and orders fell 42.2% in August, which brought orders back in-line with June levels. These severe up-and-down moves caused the biggest one-month increase and the biggest subsequent one-month decrease in overall manufacturing orders since data started being collected
Excluding transportation, factory orders declined a much more modest 0.1% in August, which was an improvement from a 0.7% decline in July
The September Challenger Job Cuts report revealed a 24.0% year-over-year drop to follow the previous reading of -20.7%

12:25 pm: [BRIEFING.COM] Recent action saw the major averages pull away from their lows after enduring a steady decline through the first two hours of action. The S&P 500 has reclaimed about eight points, but all ten sectors continue hovering in the red.

Most notably, the financial sector (-0.4%) remains the lone outperformer among cyclical groups, while the other five sectors are down between 0.6% (industrials) and 1.4% (energy). Meanwhile, the countercyclical side has held up a bit better with the exception of the health care sector (-0.7%). The group lags amid weakness in biotech names as evidenced by a 1.2% decline in the iShares Nasdaq Biotechnology ETF (IBB 266.33, -3.10).

As for the remaining defensively-oriented sectors, consumer staples (-0.1%), telecom services (-0.1%), and utilities (-0.1%) all hover near their flat lines.

12:00 pm: [BRIEFING.COM] The major averages have taken another leg down with the Nasdaq (-0.9%) continuing to lead the market lower.

Furthermore, the recent round of losses coincided with a jump in the yen, which is on course for its second consecutive advance. Yen futures are higher by 0.9%, while the dollar/yen pair hovers near 108.15 after notching an overnight high just above the 109.00 mark.

Similarly, Treasuries have been on the receiving end of safe-haven flows. The 10-yr note has narrowed its loss to just two ticks with the benchmark yield at 2.39%.

11:30 am: [BRIEFING.COM] Equity indices remain near their lows with the small-cap Russell 2000 (-0.2%) showing relative strength. To be fair, today's outperformance comes after the index plunged 6.2% in September versus a 1.9% decline for the Nasdaq and a 1.6% drop for the S&P 500.

On a separate note, markets in Europe have extended their losses into the close following today's ECB decision to stay the course. Most notably, Italy's MIB and Spain's IBEX hold respective losses of 3.8% and 3.0% with participants fleeing bank shares. The weakness comes after today's ECB announcement did not signal a forthcoming sovereign bond purchase program.

Elsewhere, Treasuries have remained in the red despite the continued equity weakness. The 10-yr note is lower by seven ticks with its yield up three basis points at 2.41%.

11:00 am: [BRIEFING.COM] The major averages have slipped to new lows for the day with yesterday's laggard-Nasdaq Composite-leading the slide. The tech-heavy index has surrendered 0.7%, while the Russell 2000 (-0.1%) hovers closer to its flat line.

A handful of influential sectors like consumer discretionary, industrials, and technology displayed relative strength at the start, but the three groups are now down between 0.5% and 0.6%. Elsewhere, the financial sector (-0.1%) is the lone outperformer among cyclical sectors.

Also of note, energy (-1.4%) has lagged from the start and the growth-sensitive sector has recently notched a fresh low even as crude oil has worked its way off the early morning low (-0.4% at $90.43/bbl).

With stocks remaining under pressure, the CBOE Volatility Index (VIX 17.29, +0.58) has crossed the 17.00% mark and is on track to register its third consecutive advance.

10:35 am: [BRIEFING.COM] Precious metals and crude oil are trading lower this morning despite a weaker dollar index.

Dec gold traded as high as $1222.00 in overnight action but has retreated into the red. It touched a pit session low of $1209.90 in early morning action and is now lower by 0.3% at $1211.50.

Dec silver fell as low as $16.93 moments before floor trade opened and is currently down 1.6% at $16.98.

Nov crude oil is also in the red. It traded as low as $88.18 in overnight action but has been inching higher. The energy component is currently printing a loss of 0.5% at $90.29.

Nov natural traded as low as $3.96 in early morning action ahead of inventory data. Prices fell further to new session lows following data that showed a build of 112 bcf when expectations called for a build of 107 bcf. Natural gas is currently down 2.4% at $3.93.

10:00 am: [BRIEFING.COM] The S&P 500 trades within a point of its flat line.

The just-released factory orders report for August indicated orders decreased 10.1%, which was worse than the Briefing.com consensus estimate that called for a decrease of 9.3%. The July reading was left unrevised at 10.5%.

9:40 am: [BRIEFING.COM] The major averages began the day in the red, but have been able to erase their opening losses. The S&P 500 trades higher by 0.1% with eight sectors in the green.

Influential groups have displayed early strength with consumer discretionary (+0.2%), financials (+0.2%), and industrials (+0.3%) starting the session ahead of the broader market. On the flip side, the energy sector (-0.5%) has continued its recent weakness amid another slide in crude oil. The energy component is lower by 1.1% at $89.70/bbl.

Treasuries continue holding losses with the 10-yr yield up three basis points at 2.41%.

The Factory Orders report for August will be released at 10:00 ET (Briefing.com consensus -9.3%).

9:17 am: [BRIEFING.COM] S&P futures vs fair value: -4.70. Nasdaq futures vs fair value: -4.80. The stock market is on track for a lower start to the session as futures on the S&P 500 trade five points below fair value. Index futures held a modest gain in recent action, but slipped back into the red while European Central Bank President Mario Draghi delivered his remarks after the ECB made no changes to its policy stance.

During his press conference, Mr. Draghi commented on the eurozone, saying recent data indicates growth in the single-currency bloc is weakening. The ECB President reaffirmed his commitment to accommodative policy, but conceded that fiscal reforms are still needed. Despite some speculation ahead of the policy meeting, the central bank did not hint at plans for sovereign bond purchases, which has fueled a rally in the euro. The single currency trades near 1.2685 versus the dollar after hovering near 1.2630 just before the press conference began. Conversely, the Dollar Index (85.51, -0.46) is lower by 0.5%.

Domestically, things have been very quiet on the corporate front with few movers of note. Constellation Brands (STZ 82.53, -2.73) is indicated to open lower by 3.2% after missing earnings and revenue estimates. Elsewhere, Cree (CREE 33.95, -5.67) holds a pre-market loss of 14.3% after lowering its Q1 guidance.

Treasuries hover in the red with the 10-yr yield up one basis point at 2.40%.

The Factory Orders report for August will be released at 10:00 ET (Briefing.com consensus -9.3%).

8:58 am: [BRIEFING.COM] S&P futures vs fair value: +1.80. Nasdaq futures vs fair value: +7.70. The S&P 500 futures trade two points above fair value.

Markets fell across Asia. China's Foreign Minister Wang Yi dubbed the protests in Hong Kong as illegal. Meanwhile, press reports indicate protestors plan to occupy government buildings, starting tonight, if Chief Executive CY Leung does not tender his resignation

Economic data was limited:
Australia's Building Approvals rose 3.0% month-over-month (expected 1.0%; prior 2.1%). Separately, the trade deficit narrowed to AUD787 billion from AUD1.08 trillion (expected deficit of AUD700 billion)
New Zealand's ANZ Commodity Price Index declined 1.3% month-over-month (previous -3.3%)

------

Japan's Nikkei tumbled 2.6% to a one-month low as the yen strengthened. Exporters were hit hard with Honda Motor falling 3.2% and Toyota Motor losing 2.1%.
Hong Kong's Hang Seng was closed for Chung Yeung Day.
China's Shanghai Composite was closed for National Day.

Major European indices trade lower across the board with Italy's MIB (-1.2%) showing the largest decline. The European Central Bank made no changes to its policy stance, keeping its main refinance rate at 0.05%, as expected.

In economic data:
Eurozone PPI ticked down 0.1% month-over-month in August (expected -0.2%; previous -0.2%), while the year-over-year reading fell 1.4% (consensus -1.2%; last -1.3%)
Great Britain's Construction PMI rose to 64.2 from 64.0 (expected 63.5)
Spain's Claimant Count rose 19,700 (expected 31,300; previous 8,100)

------

Germany's DAX trades lower by 0.1%. Producers of basic materials lag for the second day in a row with K+S and ThyssenKrupp down 1.4% and 1.0%, respectively. Deutsche Boerse outperforms with a solid gain of 1.6%.
Great Britain's FTSE trades down 0.3%. Stocks with U.S. exposure are among the laggards with Ashtead Group and Babcock International down 3.3% and 2.9%, respectively.
France's CAC is lower by 0.4%. Growth-sensitive names underperform with ArcelorMittal, Cie de St-Gobain, and Legrand down between 0.2% and 1.2%.
In Italy, the MIB has given up 1.2% amid weakness in bank shares. Banco Popolare, BMPS, Unicredit, and UnipolSai are down between 1.4% and 2.9%.

8:32 am: [BRIEFING.COM] S&P futures vs fair value: +4.30. Nasdaq futures vs fair value: +11.50. The S&P 500 futures trade four points above fair value.

The latest weekly initial jobless claims count totaled 287,000, while the Briefing.com consensus expected a reading of 297,000. Today's tally was below the revised prior week count of 295,000 (from 293,000). As for continuing claims, they fell to 2.398 million from 2.443 million.

8:00 am: [BRIEFING.COM] S&P futures vs fair value: +3.70. Nasdaq futures vs fair value: +9.50. U.S. equity futures trade modestly higher despite cautious action overseas. The S&P 500 futures hover four points above fair value, signaling the benchmark index is on track to rebound from yesterday's broad-based retreat that sent the index lower by 1.3%.

Dollar strength has been a prevailing theme in recent weeks, but the Dollar Index (85.77, -0.20) is taking a breather today with the greenback giving some ground to the euro (+0.1%) and the yen (+0.3%)

In U.S. corporate news of note:

Autodesk (ADSK 57.16, +1.50): +2.7% after Citigroup upgraded the stock to 'Neutral' from 'Sell.'
Constellation Brands (STZ 81.00, -4.26): -5.0% after missing earnings and revenue estimates.

Treasuries hold losses with the 10-yr yield up two basis points at 2.41%.

The September Challenger Job Cuts report revealed a 24.0% year-over-year drop to follow the previous reading of -20.7%.

Weekly Initial Claims (Briefing.com consensus 297K) and Factory Orders for August (consensus -9.3%) will be released at 8:30 ET and 10:00 ET, respectively.

Reviewing overnight developments:

Asian markets ended lower. Japan's Nikkei -2.6%, while China's Shanghai Composite and Hong Kong's Hang Seng remained closed for Golden Week
Economic data was limited:
Australia's Building Approvals rose 3.0% month-over-month (expected 1.0%; prior 2.1%). Separately, the trade deficit narrowed to AUD787 billion from AUD1.08 trillion (expected deficit of AUD700 billion)
New Zealand's ANZ Commodity Price Index declined 1.3% month-over-month (previous -3.3%)
In news:
China's Foreign Minister Wang Yi dubbed the protests in Hong Kong as illegal. Separately, press reports indicate protestors plan to occupy government buildings, starting tonight, if Chief Executive CY Leung does not tender his resignation.

Major European indices trade in mixed fashion. Germany's DAX +0.1%, France's CAC -0.1%, and Great Britain's FTSE -0.1%. Elsewhere, Italy's MIB -0.8% and Spain's IBEX -0.4%
In economic data:
Eurozone PPI ticked down 0.1% month-over-month in August (expected -0.2%; previous -0.2%), while the year-over-year reading fell 1.4% (consensus -1.2%; last -1.3%)
Great Britain's Construction PMI rose to 64.2 from 64.0 (expected 63.5)
Spain's Claimant Count rose 19,700 (expected 31,300; previous 8,100)
Among news of note:
The European Central Bank made no changes to its policy stance, keeping its main refinance rate at 0.05%, as expected.

6:51 am: [BRIEFING.COM] S&P futures vs fair value: +0.50. Nasdaq futures vs fair value: +3.00.

6:51 am: [BRIEFING.COM] Nikkei...15,661.99...-420.30...-2.60%. Hang Seng...Holiday.........

6:51 am: [BRIEFING.COM] FTSE...6,540.96...-16.60...-0.20%. DAX...9,380.29...-2.00...0.00.

Euro Jumps Most in 7 Months as ECB Plan Lacks Details

By Andrea Wong and Rachel Evans Oct 2, 2014 5:13 PM ET

The euro climbed the most since March as the European Central Bank failed to provide details on the size of a plan to buy private debt, curbing bets it would expand the ECB’s balance sheet enough to weaken the currency.

The yen advanced as Japanese Vice Finance Minister Nobuhide Minorikawa said weakness in the currency is hurting some companies by driving up energy prices. Australia’s dollar rebounded from an eight-month low, while the pound fell and the U.S. currency declined. The euro gained from almost a two-year low as ECB President Mario Draghi unveiled plans to buy covered bonds and asset-backed securities for at least two years.

“It’s probably a relatively short-lived rally,” Jennifer Vail, head of fixed income at U.S. Bank Wealth Management in Minneapolis, said in a phone interview. “The next negative economic print is going to weigh on the euro again. I don’t think it has substantial legs. It’s kind of bouncing off the bottom.”

The euro jumped as much as 0.6 percent, the biggest intraday increase since March 6, to $1.2699 before trading at $1.2669 at 5 p.m. New York time, up 0.4 percent. It touched $1.2571 on Sept. 30, the lowest level since September 2012.

The yen appreciated 0.4 percent to 108.42 per dollar, after reaching 110.09 yesterday, the weakest since August 2008. It gained 0.1 percent to 137.35 per euro.

Yen Strengthens

Japan’s currency rose for a second day following Minorikawa’s comments, which came after former Finance Minister Hirohisa Fujii said yesterday further declines in the currency may trigger intervention. The Bank of Japan’s stimulus policy leading to a weak yen is mistaken, he said in an interview. The central bank is trying to avert deflation and spur the economy.

Dissent is increasing against the accommodative monetary policy, which has seen 60 trillion yen ($553 billion) to 70 trillion yen committed to annual asset purchases, as consumer prices remain depressed and growth is anemic. The weaker yen puts Japan at risk of recession, Kazumasa Iwata, deputy governor of the central bank until 2008, warned last month.

The yen dropped 5.1 percent in September against the dollar, the biggest monthly decline since January 2013.

“The whole notion of devaluing the currency has been a bad policy,” Robert Sinche, a global strategist at Pierpont Securities LLC in Stamford, Connecticut, said by phone. “They think the yen is overvalued, but we’ve just had a very extreme move, and I think their concern was that it could destabilize markets and destabilize the economy.”

Implied Volatility

Implied volatility for one-month options on the U.S. dollar versus the Japanese currency rose to 8.85 percent, the highest on a closing basis since March 3. The measure is used to set option prices and gauge the expected pace of currency swings. The average this year is 6.96 percent.

The yen will trade at 113 to the dollar at the end of next year, according to the median forecast of analysts in a Bloomberg survey.

In Europe, Draghi told reporters today the ECB balance sheet is just “an instrument.” The only mandate policy makers have to comply with is to bring inflation back to a level that is close to, but below, 2 percent, he said. Euro-area consumer prices rose an annual 0.3 percent in September.

The purchase program is part of an easing plan the ECB president previously said would steer the balance sheet back toward levels seen at the start of 2012, signaling as much as 1 trillion euros ($1.3 trillion) in assets may be added.

‘Additional Measures’

“Draghi was playing down the oncoming rise in the balance sheet, that’s the market’s initial read,” said Alan Ruskin, global head of Deutsche Bank AG’s Group of 10 foreign exchange in New York. “But over time the market will come to realize the inflation expectation will remain stubbornly inert and it’ll evoke what he said at least three times: he’s open to additional measures beyond what they’ve done.”

ECB policy makers kept the key interest rates unchanged at record lows, as predicted by all analysts surveyed by Bloomberg.

The Bloomberg Dollar Spot Index fell 0.3 percent to 1,067.44, the biggest drop on a closing basis since June 18. It reached 1,070.94 on Sept. 30, the highest closing level since June 2010.

U.S. factory orders dropped 10.1 percent in August, a government report showed, after climbing 10.5 percent the previous month. Economists surveyed by Bloomberg forecast a 9.5 percent drop.

Jobs Report

The number of Americans applying for unemployment benefits unexpectedly fell last week to 287,000, from 295,000, the Labor Department reported. U.S. employers added 215,000 jobs in September, economists forecast before the department issues a report tomorrow. The gain in August was 142,000.

The dollar climbed 3.4 percent in the past month versus nine other developed-nation currencies tracked by Bloomberg Correlation Weighted Indexes, the best performance. The euro weakened 0.6 percent, while the yen was little changed. The Australian and New Zealand dollars were the biggest losers, each dropping 2.4 percent.

The two South Pacific currencies climbed today as policy makers eased property restrictions in China, their biggest trading partner. New Zealand’s dollar rallied 1.5 percent to 79.02 U.S. cents. The Aussie rose 0.7 percent to 88.03 U.S. cents, after falling yesterday to as low as 86.63 cents, the least since Jan. 24.

The move by the People’s Bank of China on Sept. 30 marked a reversal in a four-year tightening campaign, as slowing property investment and industrial production raise risks that economic growth will drift too far below the government’s target.

The U.K.’s pound dropped against most of its 31 major counterparts after Bank of England policy maker Ben Broadbent suggested the U.K. economic recovery may not be strong enough to warrant an interest-rate increase.

The pound fell 0.3 percent to $1.6145 and weakened 0.6 percent to 78.47 pence per euro.

Broadbent said in an interview with ITV that Britain is “not ready yet” for a higher rate.

To contact the reporters on this story: Andrea Wong in New York at awong268@bloomberg.net; Rachel Evans in New York at revans43@bloomberg.net

To contact the editors responsible for this story: Dave Liedtka at dliedtka@bloomberg.net Greg Storey, Paul Cox

Special thanks to Bloomberg, CNNMoney, Reuters and Yahoo! Finance for their market summaries. gm

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M.A. Perry
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