SMF Notes Overnight Developments

•Global stocks this morning are mostly lower with the Euro Stoxx 50 down -0.25% and Mar S&Ps down -2.00 points. The dollar and Treasuries strengthened as European bank stocks fell after UniCredit slumped to its lowest level in nearly 3 years when it said it will sell new shares in a 7.5 billion euro offer, fueling concern other banks will need to raise more capital. The euro declined against the dollar on mounting sovereign debt concerns after Euro-Zone banks parked 453.2 billion euros with the ECB on Tuesday, the most since the euro's introduction in 1999 as banks rather park their excess cash with the ECB at the overnight rate of 0.25% and incur a loss rather than lend it for more elsewhere. European stocks were also pressured by comments from Jean-Claude Juncker, head of the Euro-Zone finance ministers, who said "Europe is facing a recession of unknown scope." On the positive side, the Dec Euro-Zone PMI composite was revised up to 48.3 from the or iginally reported 47.9, while the Dec Euro-Zone CPI estimate fell to +2.8% y/y from +3.0% y/y as expected.

•Asian stocks today closed mixed with Japan up +1.24%, China -2.00%, Australia +2.11%, South Korea -0.64%, India -0.36%. Japanese exporters rallied and led the broader market higher on earnings optimism after manufacturing activity in the U.S. grew at the fastest pace in 6 months in Dec and China’s manufacturing activity also expanded in Dec. Chinese stocks finished down as they erased an early rally and closed lower after Premier Wen Jiabao said business conditions may be "relatively difficult" this quarter as inflation stays "elevated" and overseas demand weakens. Losses in homebuilders and property developers also helped to drag the overall market lower after Dec Chinese home prices fell for a fourth month when they dropped -0.25% m/m, according to SouFun Holdings Ltd., China's biggest real estate website owner.

ICE IntercontinentalExchange reports record futures volume in 2011, ADV up 16%; 2011 OTC Energy ADC up 15% to a record $1.6 mln; $26.2 trln cleared in CDS, record annual CDS revenues (118.56 )
Co announnced Average daily volume for December 2011 was 1,097,009 contracts, down 1% over the prior December. ICE's fourth quarter 2011 ADV increased 12% to 1,423,504 contracts compared to the prior fourth quarter. ICE's 2011 ADV was a record 1,512,610 contracts, up 16% from 2010. ICE Futures Europe and ICE.