Markets Today

What’s Inside Today’s Report:

—  Four reasons stocks rebounded (and what it means going forward).
—  Weekly economic cheat sheet.

Futures are very slightly negative but are being weighed down by European shares (specifically Italy), which are declining following the bank stress test results and some more lack luster German data.

Despite the stock reaction (which seems more like digestion of last week’s rally) the ECB stress tests weren’t bad. In total less than 1/4 of the 130 banks “failed’ and 9 were in Italy, which was expected. Capital shortfalls were also lower than expected.

In Brazil, incumbent Dilma Rousseff won a close election and Brazilian futures are sharply lower in reaction (markets wanted pro-business candidate Neves).

It will be pretty quiet today, as there are only two economic reports: October Flash Services PMI (E: 58.0), Pending Home Sales (E: 0.8%).

Earnings also continue to roll on but already a lot of the “systemically important” names have reported, and the influence on earnings on the market will start to wane throughout the week.

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