What’s in Today’s Report:
- Are Corporate Earnings Rolling Over?
- Another (Small) Sign of Dis-Inflation
- EIA Update and Oil Market Analysis
Futures are modestly lower as investors digest Wednesday’s earnings disappointments.
CSCO and NVDA reported after the close and both results were better than feared, but that’s not enough to offset growing concerns about future corporate earnings.
On inflation, October EU HICP slightly missed estimates (10.6% vs. (E) 10.7%) although the monthly reading was in-line at 1.5%, signaling that inflation pressures in the EU aren’t declining.
Today’s focus will again be on inflation so the price indices in the Philly Fed Manufacturing Index (E: -7.0) will be the key reports and any declines in those price indices should prompt at least a small rally. Outside of Philly Fed, we also get Housing Starts (E: 1.41M) and Jobless Claims (E: 222k), but neither should move markets.
There are also multiple Fed speakers today including Bostic (7:30 a.m. ET), Bowman (9:15 a.m. ET), Mester (9:40 a.m. ET), and Kashkari (10:40 a.m. ET & 1:45 p.m. ET), and we should expect their message to be consistent with recent Fed speak: The size of rate hikes will shrink, but the Fed still has a long way to go to reach the “Terminal Rate.”