September MMT: Headwinds Present but Earning Growth a Major Positive
What’s in Today’s Report:
- September Market Multiple Table (MMT): Headwinds Present but Earnings Growth a Major Positive
Futures are modestly lower as the U.S. and Iran again exchanged reciprocal strikes overnight, sending oil prices higher.
Brent crude rose above $100/bbl for the first time since May after the U.S. and Iran traded strikes on oil tankers and naval vessels, further diminishing any near term hopes for ceasefire progress.
Economically, the only notable report was Chinese CPI which beat expectations (0.8% y/y vs. (E) 0.4% y/y).
Today there are no notable economic reports (the key reports this week come Thursday/Friday via PPI/CPI) so focus will stay on geopolitics and the story remains the same: Any hint of the U.S. or Iran seeking a ceasefire will push oil lower and help stocks rebound, while more reciprocal strikes will only further boost oil prices and pressure stocks.
Beyond oil, we need to watch treasury yields. So far this week they haven’t rallied despite higher oil prices (the looming CPI is likely keeping them stable) but if that changes and yields start to rise on higher oil prices, the downward pressure on stocks will increase.
