Market Internals update at 14:00ET

***Economic Data***

– (PD) Poland Central maintained the Base Rate at 3.75%; As expected
– (BR) Brazil Jan Industrial Production M/M: +0.2% v -0.3%e; Y/Y: 2.5% v 1.5%e
– (US) MBA Mortgage Applications w/e Feb 25th: -6.5% v +13.2% prior
– (US) Feb Challenger Job Cuts: 50.7K v 38.5K prior (highest since Mar 2010); Y/Y: +20.0%% v -46.1% prior (First YoY rise since May 2009)
– (US) Feb ADP Employment Change: +217K v +180Ke
– (CA) Canada Jan Industrial Product Price M/M: 0.2% v 0.6%e; Raw Materials Price Index M/M: 0.3% v 3.0%e
– (US) Weekly DOE Energy Inventories: Crude: -360K v +1Me; Gasoline: -3.6M v 0.0e; Distillate: -750K v -1Me; Utilization: 80.9% v 79.8%e

– Front-month WTI crude popped over $100 again this morning after another crazy Gaddafi speech in which the embattled despot said he would “give NATO and the US hell” if they intervened in Libya. Spot gold hit fresh all-time highs above $1,436.50. Asia and European equity opened lower, however investors have pushed US equity indices higher during the New York session, while European indices have regained losses. The surprisingly strong ADP February jobs report has aided sentiment in US trading, although analysts caution that the ADP data has not been a reliable predictor of monthly payrolls data for some time. Fed Chairman Bernanke headed over to the House for testimony this morning after the Senate session yesterday. Rep Barney Frank said the Fed should keep open the possibility of additional bond purchases following recent oil price moves, while PIMCO’s El Erian warned that it will be difficult for the Fed to contain inflation if oil prices continue to rise. US Treasury prices are a bit lower but rates remain fairly close to where they were yesterday despite the strong ADP jobs report.

– Weatherford International plummeted in pre-market trading, losing 16% on news that it would have to delay its 10-K in order to work adjustments to 2007-10 results totally around $500M. Shares of WFT are only down 10% in early trading. Discount retailer names Costco and BJ’s both reported sold results from their December quarters, on strong comp store sales. Note that BJ’s is currently exploring strategic alternatives, most likely with private equity buyers. Shares of BJ are up nearly 2% this morning, while COST is in the red. Staples came up short in earnings and revenue in its Q4, blaming a fall off in European sales for the miss. Staples also said that demand for PCs was weak in the quarter, and that it would be rolling out sales of mobile phones and tablet computers in 2011. Shares of SPLS are down 2%. Mining equipment manufacturer Joy Global missed both top- and bottom-line expectations, although it also raised its 2011 guidance. Executives said they were bullish on mining company capex spending in 2011. Shares of JOYG were down as much as 5%, but have risen steadily in early trading to unchanged. Mortgage insurer MBIA crushed earnings expectations thanks to a one-time gain on mark-to-market changes, while revenue was subpar. MBI is down 6%, while competitors MTG and RDN are up more than 4%. Homebuilder Hovnanian continues to lose considerable amounts of money, although its Q1 revenue was slightly better than expected and shares of HOV are in positive territory.

– Rising oil prices driven by more bloodshed in the Middle East directly weighed on the greenback, as traders speculate that the events in the region appears to be dethroning “King Dollar.” The USD once again was unable to rack up flight-to-safety gains even as USD/CHF posted fresh historic lows below 0.9230 and the better-than-expected ADP employment data was largely ignored. EUR/USD breached the early Feb highs of 1.3862. The technical picture for the dollar is looking ugly and could prompt a coordinated response if the price action morphs into ‘disruptive and disorderly’ territory.

***Looking Ahead***

– (BR) Brazil Central Bank (COPOM): Interest Rate Decision: Expected to raise the SELIC Target Rate by 50bps to 11.75%
– 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
– 11:00 (US) US Senate vote on 2-week work stoppage spending bill
– 11:00 (IC) Iceland Q4 Current Account (ISK): No est v 24B prior
– 11:30 (GE) Rogoff addresses Debt Crisis at German Finance Ministry Event
– 14:00 (US) Fed’s Beige Book
– 14:15 (US) Fed’s Lockhart speaks on U.S. Economic Outlook in Atlanta
– 15:30 (MX) Mexico Jan YTD Budget Balance (MXN): No est v -370.6B prior
– 20:00 (US) Fed Chairman Bernanke speaks on State and Local challenges in NY
– 20:00 (CH) China Feb Non-manufacturing PMI: no est v 56.4 prior