Hard vs. Soft Landing Scoreboard: More Signs of Slowing Growth

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Hard vs. Soft Landing Scoreboard: More Signs of Slowing Growth: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Hard Landing vs. Soft Landing Scoreboard: Still a Soft Landing But More Signs of Slowing Growth
  • Chart: Consumer Confidence Data Points to Slowing Growth

Futures are lower as traders continue to reposition following last week’s sprint to record highs while focus shifts ahead to tomorrow’s critical inflation data.

Economically, the headline of the Eurozone Economic Sentiment report fell to 95.4 vs. (E) 96.7 which didn’t help risk assets in pre-market trade.

Today, traders will be watching the release of Q4 GDP (E: 3.3%) and International Trade in Goods (E: -$88.1B) ahead of the bell. Any data that is not Goldilocks (or “Platinumlocks”) will likely keep stocks under pressure ahead of tomorrow’s PCE Price Index report.

Later in the day, there are several Fed speakers: Bostic (12:00 p.m. ET), Collins (12:15 p.m. ET), and Williams (12:45 p.m. ET). Bostic and Williams are on the FOMC, so their comments have the potential to move markets with tomorrow’s inflation data coming into view.

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Which Sectors Benefit From Trump’s Policies

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Which Sectors Benefit From Trump’s Policies: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Government Shutdown Update
  • Which Sectors Benefit From Trump’s Policies
  • “Short-Volatility Trade” Update: Chart

Futures are little changed this morning as investors digest a hotter than expected inflation print out of Japan and still cautious gauge of consumer sentiment in Europe ahead of a busy day of economic data in the U.S.

Overnight, Japanese Core CPI fell to 3.5% vs. (E) 3.3% while the German GfK Consumer Climate Index edged up by a modest 0.7 points to -29.0 vs. (E) -29.6. Neither release was particularly positive for markets but futures are stable ahead of today’s domestic data.

Looking into today’s session, there are four economic reports to watch this morning: Durable Goods Orders (E: -4.5%), Case-Shiller Home Price Index (E: 0.2%), FHFA House Price Index (E: 0.1%), Consumer Confidence (E: 115.0). Markets will want to see stability in the housing market data and easing but not collapsing growth and sentiment numbers in order for stocks to hold near the recently established record highs.

There are no Fed officials scheduled to speak today but there is a 7-Yr Treasury Note auction at 1:00 p.m. ET. Yesterday’s 2-Yr and 5-Yr Note auctions were weak, putting upward pressure on yields and if today’s 7-Yr auction is weak as well, expect the benchmark 10-Yr yield to test the critical 4.30% level which could weigh on equity markets.

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What’s Changed Since October (And Is It Worth A 25% Rally?)

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What’s Changed Since October: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • What’s Changed Since October (And Is It Worth A 25% Rally?)
  • Weekly Market Preview:  Can Data and News Stay Platinumlocks?
  • Weekly Economic Cheat Sheet:  An Important Week for Inflation.

Futures are little changed following a generally quiet weekend of news.

Geopolitically, news was mixed over the weekend.  Positively, progress was made in negotiating a Israel/Hamas cease fire and there is hope an agreement can be reached this week.  Negatively, chances of a U.S. government shutdown on March 1st (this Friday) are rising.

There were no notable economic reports overnight.

This will be a busy week of important economic data, earnings and political news (possible government shutdown on Friday) but it starts slowly as the only notable economic report today is New Home Sales (E: 685k) and there is just one Fed speaker, Schmid at 7:40 p.m. ET.  So, focus will remain on the political headlines today and if shutdown chances increase, look for mild pressure on stocks.

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$57,691 Is The Next Key Resistance Level To Watch For Bitcoin

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The Next Key Resistance Level To Watch For Bitcoin: Tom Essaye Quoted in Barron’s on MSN

Bitcoin Falls Before Fed Minutes and Nvidia Earnings. Where Prices Could Go Next.

“There is a well-defined uptrend channel in place that leaves the path of least resistance higher,” said Tom Essaye, the founder of Sevens Report Research. “$57,691 is the next key resistance level to watch” for Bitcoin, Essaye noted, referencing a technical indicator that flashed this technical level and adding that “we expect to at least see some hesitation as prices move into the mid $50,000s.”

Also, click here to view the full Barron’s article published by MSN on December 8th, 2023. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

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Tom Essaye Quoted In Barron’s on February 21, 2024

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Hedging Up Ahead Of The Results: Tom Essaye Quoted in Barron’s

Stocks Open Lower Ahead of Fed Minutes, Nvidia Earnings

“There are no notable economic reports today, but the January Fed meeting minutes will be released at 2:00 p.m. ET and that could move Treasury yields and ultimately impact stocks,” writes Sevens Report Research’s Tom Essaye.

Nvidia, which was the poster child for 2023’s artificial intelligence stock rally, was on track to dip again ahead of the chip maker’s earnings report that’s due after the market closes.

Also, click here to view the full Barron’s article published on February 21st, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to Rally

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Nvidia Has Been The ‘Poster Child’ Of AI Enthusiasm

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Nvidia Has Been The ‘Poster Child’ Of AI Enthusiasm: Tom Essaye Quoted in Bloomberg Featured on Yahoo Finance

Tech Up in Late Hours on Nvidia’s Bullish Outlook: Markets Wrap

“Nvidia has been the ‘poster child’ of AI enthusiasm because NVDA makes the type of semiconductor chips that power generative AI and demand for those chips has gone through the roof,” said Tom Essaye, founder of The Sevens Report. “The AI-driven rally in the ‘Mag Seven’ is largely justified by the fact that they’re making a lot more money than they were previously.”

While Nvidia is the proverbial “picks and shovels” of the “AI gold rush”, other big-tech companies such as Microsoft Corp., Meta Platforms Inc., Alphabet Inc., Amazon.com Inc. and Apple Inc. have also seen large stock rallies as investors expect these companies to harness the power of generative AI to boost profits, Essaye noted.

“Has the AI mania gone too far and are we looking at a bubble situation?” Essaye said. “Based on what most of us think about typical bubbles, the answer is ‘no’ they are not in a bubble.”

Also, click here to view the full Bloomberg article featured on Yahoo Finance published on February 21st, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Tech Stocks Pulled Bacl – Tom Essaye Quoted In Barron’s

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Hedging Up Ahead Of The Results: Tom Essaye Quoted in Barron’s

Tech Stocks Pulled Back. The Nasdaq Fell 0.9%.

“You’ve got arguably the most important stock in the whole market producing earnings tomorrow, so I think that you’re just seeing some people reduce a little bit of exposure into that earnings print on the chance that perhaps it isn’t as fantastic as everybody expects it to be,” Sevens Report Research’s Tom Essaye told Barron’s in a phone interview.

Essaye said that last Friday’s selling flowed through to today as traders expressed worries that inflation isn’t going to come down as fast as they were previously pricing in.

“I don’t think it means a lot to be honest,” Essaye says. “Because if Nvidia posts good earnings tomorrow, all this is going to be undone relatively quickly.”

Also, click here to view the full Barron’s article published on February 21st, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to Rally

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

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What Blowout NVDA Earnings Mean for Markets

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What Blowout NVDA Earnings Mean for Markets: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • What Blowout NVDA Earnings Mean for Markets

Futures are sharply higher thanks to stronger than expected NVDA earnings (stock up 14% pre-market) as Nasdaq futures surge by more than 2%.

NVDA results beat on revenue, earnings and guidance and global markets are higher on renewed AI enthusiasm.

Economically, EU and UK flash PMIs were very slightly better than expected but aren’t moving markets.

Today focus will shift back to economic data and the notable reports today are Jobless Claims (E: 216K), February Flash PMIs (E: 51.4) and Existing Home Sales (E: 3.98 M).  The more Goldilocks the data, the better for markets and the key remains Treasury yields.  If yields rise in response to the data, look for a headwind on stocks to push back on the NVDA led rally.

There are also multiple Fed speakers today including Jefferson, Harker, Kashkari, Cook & Waller but barring a major surprise, they shouldn’t move markets (Fed messaging has been very consistent lately:  Inflation is receding, but they need more proof before cutting rates which means a June cut is most likely at this point).

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Hedging Up Ahead Of The Results

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Hedging Up Ahead Of The Results: Tom Essaye Quoted in Barron’s

Nvidia Weighs on Tech Stocks Ahead of Earnings

“I think what you’re seeing is just some hedging up ahead of the results,” Sevens Report Research’s Tom Essaye told Barron’s in a phone interview. “I think that’s part of it. The other part of it is you’re still seeing some follow through from Friday selling, too, as people are getting, not nervous about a rebound in inflation, but a little less sure that inflation is just going to keep going straight down in a line.”

Also, click here to view the full Barron’s article published on February 20th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to Rally

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To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Reminiscent Of The 2018 ‘Volmageddon’ Event

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Reminiscent Of The 2018 ‘Volmageddon’ Event: Tom Essaye Quoted in Morningstar

‘Volmageddon 2’ may be coming to a stock market near you, says this analyst

An important reason why the S&P 500 dropped 1.4% on Tuesday, according to Essaye, was an an overcrowded short side of the options market, which exacerbated the selling.

The action, says Essaye, “was reminiscent of the 2018 ‘Volmageddon’ event that ultimately resulted in several ‘short-volatility’ ETF’s being forced to liquidate as volatility exploded higher amid a more than 10% drop in the S&P 500 in just two weeks.”

“Fast forward to late 2023 and early 2024 and we are once again seeing similar, volatile price action into certain derivatives expirations, namely the monthly VIX futures expirations,” says Essaye. The chart below shows the sharp gap-down sell-offs for the S&P 500 into each of the last three VIX expirations.

Also, click here to view the full MarketWatch article published on Morningstar on February 16th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Oil Inventories

Lastly, If you want research that comes with no long-term commitment, yet provides independent, value-added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.