Here is why we are going to see a wild week of trading for major markets.

But first, a quick note from Art Cashin…

From Art Cashin:  Yet One More Caveat From Jason – The incomparable Jason Goepfert of SentimenTrader noticed the near frothy enthusiasm that followed the IPO in SNAP. He dug into his enormous files to see if prior “hot” IPO’s corresponded to subsequent moves in the general market.

Here’s a bit of what he wrote:

“Investors were hungry for fresh blood. The IPO of Snap on Thursday was well-received. The offer of more than $3 billion not only saw a nice bump at the open but managed to bring in retail traders during the day and end higher than its opening price. There have been three other time periods in the past 20 years when an IPO of more than $1 billion gained at least 30% after rallying during the trading day, which were prior to the market peaks in 2000, 2007, and 2015.”

Now, for a summary of where things stand…

Summary from Peter Boockvar:

Positives:

1) The Fed has finally come around to the belief that rising inflation, a even tighter labor market, a dramatic easing in financial conditions as seen in equity and credit markets, and upcoming fiscal stimulus of some kind would thus mark a good time to raise rates from just .625% sooner rather than later.

2) Initial jobless claims plunged by 19k w/o/w to 223k, well below the estimate of 245k. There was likely seasonally adjustment issues around President’s Day holiday so wait a week to see the real trend. This brings the 4 week average down to 234k from 241k. Continuing claims, delayed by a week, rose by 3k.

3) The ISM manufacturing index for February was 57.7, up 1.7 pt from January and 1.5 pts above the estimate. It’s at the best level since August 2014. Of the 18 industries surveyed, 17 saw improvement vs just 12 last month. The ISM said “Comments from the panel largely indicate strong sales and demand, and reflect a positive view of business conditions with a watchful eye on commodities and the potential for inflation.”

4) The February ISM services index rose 1.1 pts to 57.6, unchanged was expected. It’s at the best level since October 2015. The breadth of the improvement was also evident as 16 of the 18 industries surveyed saw growth vs 12 last month. The two seeing contractions was real estate/rental, leasing (higher rates, less access to capital in CRE, tighter lending standards, lack of inventory?); and information. ISM said “The non manufacturing sector reflected strong growth in February after cooling off in January. Respondents’ comments continue to be mixed, with some uncertainty; however, the majority indicate a positive outlook on business conditions and the overall economy.”

5) With last week’s drop in mortgage rates (before the jump back this week), mortgage applications to buy a home jumped by 6.5% off the lowest level since November but it’s still down by 4.6% y/o/y. Refi’s rose by 5.1% but they are down 45% y/o/y. Mortgage rates are up about 50 bps y/o/y.

6) The Conference Board’s consumer confidence index in February rose 3.2 pts to 114.8 which was above the forecast of 111. It exceeds the December print of 113.3 and is at the best level since July 2001. Both main components were up. The answers to the labor market questions were mixed. Spending intentions in the coming 6 months on auto’s, homes and major appliances are all at pre election levels and thus how one feels doesn’t always equate to how they behave. One year inflation expectations held at 4.9%, a 5 month high.

7) January headline CPI in Japan rose .4% y/o/y as expected vs .3% in December and the core/core rate (ex both food and energy) was up by .2%, twice the pace as in the month prior and also as forecasted. The more up to date February CPI for Tokyo saw no change in prices y/o/y ex food and energy and a drop of .3% at the headline level. Ironically, Japan has actually had price stability over the past 25 years with CPI since 1992 averaging .2% per year.

8) The Japanese jobs market remains tight. The jobs to applicant ratio held at 1.43, the highest since 1991 and the unemployment rate is at just 3%, down one tenth and matching the lowest level since 1995.

9) The China manufacturing data improved slightly in February m/o/m for both the state and private sector weighted measures.

10) India’s services PMI is back above 50 at 50.7 from 49.4 last month as hopefully they are at the end of the disastrous currency swap. Their manufacturing PMI was also up. PMI’s in Malaysia, Vietnam and the Philippines also saw gains.

11) South Korea’s industrial production in January rose 3.3% m/o/m vs the estimate of up .3% and led by semi’s. Exports spiked 20.2% y/o/y, well more than the estimate of up 13.6% with semi’s and petro products the main drivers.

12) The final look at Eurozone services PMI was 55.5, .1 pt below the 1st print but up from 53.7 in January and it’s at the best level since May 2011.

13) The final read of Europe’s February manufacturing PMI was 55.4, up from 55.2 in January and a hair below the initial print of 55.5. It’s still the best level in almost 6 years. Markit said “Companies are reporting stronger demand in both home and export markets, with the weakened euro providing an accompanying tailwind to help drive sales.” Also, “the rate of job creation seen so far this year in the manufacturing sector has consequently been among the best seen in the history of the euro.”….more here