Tom Essaye quoted in MarketWatch on May 2nd 2019. After Powell’s news conference, investors were “left with a market lacking a material, positive catalyst at the moment and one at the top of reasonable valuations…” said Tom. Click here to read the full article.
What’s in Today’s Report:
Futures are tentatively bouncing from yesterday’s late sell off as markets digest an imminent U.S./China trade deal, mixed economic data and the Fed meeting.
Multiple press reports yesterday implied a U.S./China trade deal could be completed next Friday, with the 10% tariffs on 250B in goods immediately reduced. This meets current market expectations and is already priced in, so there was no rally on the news.
Economic data met low expectations overnight as the EU Manufacturing PMI rose slightly to 47.9 vs. (E) 47.8, but that’s not moving markets.
Today we get a few notable economic reports via Jobless Claims (E: 215K), Productivity and Costs (E: 1.9%, 1.8%) and Factory Orders (E: 1.5%), but none of those should move markets. Instead, with no major events scheduled for today, traders will be focused on whether the S&P 500 can hold yesterday’s low (2923). If that support is fails than look for selling to accelerate.
What’s in Today’s Report:
S&P futures are indicating stocks will open at all-time highs today thanks to strong earnings and Fed optimism after President Trump mentioned rate cuts and QE yesterday.
AAPL beat on earnings and revenue in Q1 but also notably revised guidance solidly higher citing improvement in Chinese markets. The company’s shares are trading up roughly 6% in the pre-market.
Most overseas markets are closed for holidays today and the market’s main focus will be the Fed events this afternoon: FOMC Meeting Announcement (2:00 p.m. ET), Fed Chair Press Conference (2:30 p.m. ET).
There are a however a few important economic reports that could move markets this morning: ADP Employment Report (E: 180K), ISM Manufacturing Index (E: 55.0), and Construction Spending (E: 0.2%).
Bottom line, the market is looking for more dovish rhetoric out of the Fed today and if Powell delivers, another set of closing highs in U.S. stock indexes is likely.
