Good morning, it is all about inflation on this beautiful Wednesday:
Overseas, China's CPI increased at its fastest year-over-year pace since November, while Germany's CPI increased at its fastest year-over-year pace since 1974 in the April reading.
In the US, CPI inflation surprised to the upside, with a core number of 6.2 percent (0.6% m/m) and a headline number of 8.3 percent (0.3% m/m).
As a result the S&P 500 future is dipping below 4000 as we speak, while the yield of 10Y Treasury Notes jumps back over the three percent hurdle.
Yesterday investors reduced their put exposure at strikes below 4000 index points and slightly increased their call contracts, suggesting there is still no real sign of outright capitulation and the situation is still pretty much tied.
4000 remains the focal point, while downside targets remain at 3950/3900 and upside target can be identified at 4050 and 4100. Implied dealer gamma registers at -1031, suggesting high volatility for the session ahead. Gamma "flips" positive at 4360.
Overseas, China's CPI increased at its fastest year-over-year pace since November, while Germany's CPI increased at its fastest year-over-year pace since 1974 in the April reading.
In the US, CPI inflation surprised to the upside, with a core number of 6.2 percent (0.6% m/m) and a headline number of 8.3 percent (0.3% m/m).
As a result the S&P 500 future is dipping below 4000 as we speak, while the yield of 10Y Treasury Notes jumps back over the three percent hurdle.
Yesterday investors reduced their put exposure at strikes below 4000 index points and slightly increased their call contracts, suggesting there is still no real sign of outright capitulation and the situation is still pretty much tied.
4000 remains the focal point, while downside targets remain at 3950/3900 and upside target can be identified at 4050 and 4100. Implied dealer gamma registers at -1031, suggesting high volatility for the session ahead. Gamma "flips" positive at 4360.