Stock Futures Keep Losses, Gold Near Highs After Worst Jobs Report Since 2013
London (Apr 6) As market participants slowly make their way back to trading desks around the post-Easter world, and especially the US where a truncated session on Friday morning ended in tears for anyone hoping for a 2015 US recovery following an abysmal March nonfarm payrolls print, they find that unlike on previous occasions, the equity futures liftathon is nowhere to be found this morning, with the S&P set to resume trading in the red for 2015.
That, however, should hardly come as a surprise with Q1 earnings season about to start, a season which is expected to post a decline in non-GAAP EPS terms, with Q2 and Q3 set to follow, all of this coming after a quarter which as we showed yesterday, tumbled over 17% (!) Y/Y in GAAP EPS terms.
Newsflow has been slow this weekend, with no material developments on the Greek front where Greece overnight agreed to repay its debt to the International Monetary Fund by April 9, IMF chief Christine Lagarde said after a meeting with Greek Finance Minister Yanis Varoufakis. There was speculation ahead of the visit that Athens might fail to meet the 460-million-euro ($501-million) IMF installment if forced to choose between the IMF and paying government workers. As AFP reported, Lagarde said repaying the IMF debt was in the country's best interest. "Continuing uncertainty is not in Greece's interest and I welcomed confirmation by the minister that payment owing to the Fund would be forthcoming on April 9th," Lagarde said in a statement.
In other words, Greece has "agreed" not to default. Still, many wonder if this is just another ploy to buy time (after all Greece is merely borrowing money from the Troika to repay the Troika with nothing sticking in the local economy, a recipe for a prompt government overhaul), while the Tsipras government pivots East, something we first suggested three months ago. As the Telegraph suggests this morning, "Greece's bail-out drama is threatening to take a geostrategic turn to the east. A mere three weeks after his maiden trip to Berlin, Prime Minister Alexis Tsipras is on the road again, this time heading to the heart of Greece's eastern hegemon. On Wednesday, the 40-year-old premier will sit down for his first official meeting with Russian counterpart President Vladimir Putin at the Kremlin. The timing is not fortuitous."