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European optimism surges, HSBC shares plunge after a miss on revenue, and the oil market is a billion barrels long. Here are some of the things people in markets are talking about today.
Economic activity in the euro area unexpectedly rose to the highest level in almost six years, with the composite Purchasing Managers Index for February climbing to 56.0, according to IHS Markit. The rise was driven by the common-currency area's two largest economies, with composite PMIs for both Germany and France coming in above 56.0 for the month. While politics continues to dominate coverage of Europe, investors are starting to recommend looking beyond the noise to find opportunities.
Shares in HSBC Holdings Plc were down 6.5 percent in London trading at 5:15 a.m. Eastern Time after the bank reported fourth-quarter profit that missed estimates on a surprise drop in revenue. Chief Executive Officer Stuart Gulliver saw his pay increase as he hit targets for cutting expenses, while the bonus pool for employees was cut 12 percent due to the revenue drop. Despite today's dip, the bank's stock price is up 50 percent from a year ago.
A billion barrels long
Speculators hold more than a billion barrels of bets that crude prices will continue to rally. The record high position comes as oil continues to trade in a tight range, with a barrel of West Texas Intermediate for March delivery at $54.12 by 5:30 a.m.
Overnight, the MSCI Asia Pacific Index was broadly unchanged, while Japan's Topix index added 0.7 percent as the yen weakened. In Europe, the Stoxx 600 Index was 0.3 percent higher at 5:35 a.m., as economic optimism rose following the PMI numbers. U.S. stock-market futures pointed to a higher open following the holiday break.
Dollar watching Fed speakers
The greenback rose against its G-10 peers after Federal Reserve Bank of Philadelphia President Patrick Harker indicated he would support a rate increase next month, echoing Federal Reserve Bank of Cleveland President Loretta Mester who said she would be "comfortable" with the central bank raising rates. Later today Minneapolis Fed’s Kashkari and San Francisco Fed's Williams are due to speak. U.S. Treasury yields are also rising this morning, with the 10-year at 2.45 percent at 5:45 a.m.
What we've been reading
This is what's caught our eye over the weekend.
- Odd Lots Podcast: How poker explains the battle between passive investing and active management.
- Gold isn't behaving in practice the way it should in theory.
- Russia's ambassador to the UN dies unexpectedly at 64.
- Threat of cyber attack is businesses' biggest fear, according to global survey.
- In Germany, the male breadwinner is still king.
- At last, a way to count the cost of an uncertain future.
- How we got so angry.