Why Is Bitcoin Still Falling?

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What’s in Today’s Report:

  • Why Is Bitcoin Still Falling?
  • ISM Manufacturing PMI Takeaways

U.S. equity futures are higher thanks to the combination of a strong Japanese government bond auction and largely as-expected EU inflation data which are both helping yields stabilize after a sharp rise to start December yesterday.

Economically, the Eurozone’s Narrow Core HICP (Core CPI equivalent) held steady at 2.4% vs. (E) 2.5% in November.

Looking into today’s session, we will get data on domestic Motor Vehicle Sales (E: 15.4 million) which likely won’t have a material impact on markets unless there is a significant drop signaling a potential slowdown in consumer spending.

Additionally, there is one Fed speaker: Bowman (10:00 a.m. ET), and the Treasury will hold a 6-Week Bill auction at 11:30 a.m. ET. Markets are looking for dovish signals via strong demand for short-duration Treasuries and fresh support for a December Fed rate cut.

Finally, there are a few potentially market moving earnings releases today from some AI-sensitive companies including: MRVL ($0.58), CRWD ($0.07), and OKTA ($0.20).

 

Year-End Rally or Not? Three Events to Watch

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What’s in Today’s Report:

  • Year-End Rally or Not? Three Events to Watch
  • Weekly Market Preview: Can the Rebound Continue?
  • Weekly Economic Cheat Sheet: Two of the “Big Three” Monthly Economic Reports This Week

Futures are moderately lower following a sharp drop in cryptocurrencies, hawkish Bank of Japan commentary and underwhelming Chinese economic data.

Bitcoin fell 5% as pressure on the crypto space increased, although there was no specific reason for the declines.

BOJ Governor Ueda told markets the BOJ would strongly consider a rate hike at its next meeting, pressuring stocks.

Economically, the Chinese non-manufacturing PMI fell to 49.5 vs. (E) 50.1, the lowest reading in three years.

Today focus will be on the November ISM Manufacturing PMI (E: 49.0) and the key here is stability, specifically that we do not see the PMI “fall away” from 50 and badly miss expectations (if it does, it could be signaling sudden deterioration in the manufacturing sector, which would be a negative economic surprise).

 

Mixed Messages from Jobless Claims Data

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What’s in Today’s Report:

  • Economic Update: Mixed Messages from Jobless Claims Data

U.S. futures are unavailable after a “cooling issue” caused a failure at a CME data center.

Despite the lack of U.S. futures, global markets are mostly little changed and U.S. futures would likely be also, given the quiet Thanksgiving holiday.

Economically, Japanese economic data was better than expected on Thursday (Industrial Production rose 1.5% vs. (E) -0.5% and Retail Sales gained 1.7% vs. (E) 1.1%), boosting chances for a rate hike.

Today should be a typically quiet post-Thanksgiving trading day, even despite the futures issues.  U.S. markets close at 1:00 p.m.

 

A Chart for Clients: “Buying the Rip” Pays Over Time

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What’s in Today’s Report:

  • Interesting Chart for Clients – “Buying the Rip” Pays Off Over Time
  • PPI & Retail Sales Takeaways

Stock futures are higher, signaling equities are poised to extend this week’s solid advance, albeit in light holiday trading, as dovish bets for a December Fed rate cut continue to build, supporting risk-on money flows.

There were no market-moving economic reports or noteworthy financial news headlines overnight.

Today should be quiet giving the looming Thanksgiving holiday break tomorrow however there are three economic reports to watch that could impact markets including Durable Goods Orders (E: 0.1%), Jobless Claims (E: 225K), and the Chicago PMI (E: 44.3).

There are no Fed speakers today however there are multiple short-term Treasury Bill auctions this morning and a critical 7-Yr Note auction at 1:00 p.m. ET that could move yields and subsequently impact equities and other asset classes (the stronger the demand, the better).

Finally, there are two earnings reports due out today from DE ($3.96) and LI ($0.04), but given the thin volumes and light attendance ahead of Thanksgiving, it is unlikely that either release materially moves markets.

 

New ETFs for Your Watchlist

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What’s in Today’s Report:

  • Is Japan Having a “Liz Truss” Moment?
  • New ETFs for Your Watchlist

Stock futures are modestly lower as yesterday’s robust relief rally is digested ahead of the release of a slew of delayed economic reports.

Economically, German GDP met estimates of +0.3% Y/Y but steadied in Q/Q terms, up from -0.2% to 0.0% in Q3.

Looking into today’s session, there is a long list of economic data due to be released including PPI (E: 0.3% m/m, 2.6% y/y), Retail Sales (E: -0.4%), Case-Shiller Home Price Index (E: 0.1%), FHFA House Price Index (E: 0.1%), Consumer Confidence (E: 93.3), Pending Home Sales (E: -0.4), and Business Inventories (E: 0.2%).

No Fed officials are scheduled to speak (although some last-minute media interviews are possible), however there is a 5-Yr Treasury Note auction at 1:00 p.m. ET that could move yields and impact stocks, and the stronger the demand, the better for stocks (dovish money flows).

Finally, Q3 earnings continue to be released and noteworthy companies reporting today include BABA ($0.49), BBY ($1.31), ANF ($2.14), DELL ($2.26), WDAY ($0.90), and AMBA ($-0.40).

Bottom line, in order for yesterday’s relief rally to continue in thin holiday-week trading, markets will be looking for Goldilocks-to-strong economic data (not too strong to derail December rate cut bets, though) and stable to well-bid bond markets as a rebound in yields or resurgence in recession worries would pour cold water on yesterday’s risk-on money flows.

 

How Much Has the Bullish Case Deteriorated?

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What’s in Today’s Report:

  • How Much Has the Bullish Case Deteriorated?
  • Weekly Market Preview: Can AI Enthusiasm Stabilize?
  • Weekly Economic Cheat Sheet: Important Growth Data Despite the Short Week

Futures are slightly higher as investors digest last week’s volatility following a generally quiet weekend of news.

Most global markets are higher on momentum from Friday’s U.S. rally, except Japanese shares which fell sharply (down more than 2%) after unions negotiated more pay increases, boosting chances for a rate hike.

Economically, the only report was German IFO Business Expectations which missed expectations (90.6 vs. (E) 91.4).

This is a holiday shortened week but the “catch up” in economic data from the government shutdown will continue despite only three and a half trading days.  As a general rule, the more Goldilocks the data (so basically at expectations) the better as it’ll keep growth expectations stable but boost rate cut chances.

Economic reports we’re watching today include the Chicago Fed National Activity Index (E: -0.12) and Industrial Production (E: 0.1%).

 

Why Didn’t Good NVDA Earnings Support Stocks?

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What’s in Today’s Report:

  • Why Didn’t Good NVDA Earnings Support Stocks?
  • Why is Bitcoin “Crashing?”

Futures are little changed as markets try to stabilize following Thursday’s reversal following a quiet night of news.

Global stock were lower mostly on momentum from Thursday’s U.S. declines and following underwhelming data.

Economically, UK Retail Sales (-1.1% vs. (E ) -0.1%), Eurozone Flash PMI (52.4 vs. (E ) 52.5) and the UK Flash PMI (50.5 vs. (E ) 51.8) all missed expectations.

Today focus will be on the November Flash Manufacturing PMI (E: 52.3) and Flash Services PMI (E: 54.8) and markets will want to see Goldilocks data that meets expectations, implies solid economic activity and doesn’t further reduce rate cut expectations.  Conversely, if the flash PMIs are much better than expectations or much worse, they’ll likely add to downside pressure.  We also get Consumer Sentiment (E: 50.5), but that shouldn’t move markets.

Turning to the Fed, Williams (7:30 a.m. ET) and Logan (9:00 a.m. ET) speak this morning and the more dovish they are, the better.

 

Jobs Report Preview

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What’s in Today’s Report:

  • Jobs Report Preview (Important for the Fed and Growth)

Futures are moderately higher following better than expected NVDA earnings, which is reinjecting some “AI Enthusiasm” into the markets (NVDA is up 5% pre-open).

Today the “data deluge” beings as we get several delayed economic releases including, in order of importance: September Employment Situation Report (E: 50K Job-Adds, 4.3% Unemployment Rate, 3.7% Wage Growth), Jobless Claims (E: 225K), Philly Fed (E: 1.0), and Existing Home Sales (E: 4.09 million).  Goldilocks data, so close to expectations but not too strong to reduce rate cut chances or weak enough to increase economic anxiety, is the best case for markets.

On the Fed front, there are numerous speakers today including: Hammack (8:45 a.m. ET), Cook (11:00 a.m. ET) and Goolsbee (1:40 p.m. ET) and the more dovish they are, the better.

Finally, on the earnings front, WMT ($0.61) results are the key today and if they are strong (and support solid consumer spending), it’ll be an added positive.

Bottom line, given NVDA’s solid results overnight, if markets can get a Goldilocks jobs report, solid WMT earnings and dovish Fed speak, this early rally could accelerate solidly.

 

Pullback Update: What Makes It Better, What Makes It Worse

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What’s in Today’s Report:

  • Pullback Update: What Makes It Better, What Makes It Worse?

Futures are showing signs of stabilizing in pre-market trade as investors await fresh (but delayed) economic data, the October Fed meeting minutes, and critical NVDA earnings.

Economically, U.K. and EU CPI/HICP reports met estimates which is helping to quell worries about a resurgence in global inflation pressures.

Looking into today’s session, there are two economic releases that will be in focus early: Housing Starts (1.330M), International Trade (E: $-61.0B) as well as a pair of Treasury auctions mid-day: 4-Month Bills (11:30 a.m. ET) and 20-Yr Bonds (1:00 p.m. ET).

Regarding the Fed, there are two noteworthy speakers on the calendar today: Miran (10:00 a.m. ET) and Williams (2:00 p.m. ET) and the October FOMC meeting minutes will be released mid-afternoon (2:00 p.m. ET). The more dovish for markets, the better for stocks.

Finally, there are multiple noteworthy earnings releases today including TGT ($1.76), TJX ($1.22), LOW ($2.97), NVDA ($1.18), PANW ($0.50), however, NVDA results are widely considered to be the most important catalyst of the week as any disappointment could amplify the recent selling pressure and weigh heavily on big-tech, equities more broadly, and risk assets in general.

 

Your Guide to Fund Distribution Estimates

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What’s in Today’s Report:

  • Why It’s Important to Review Fund Distribution Estimates
  • Empire State Manufacturing Index Takeaways

Futures are in the red, but off session lows as traders digest yesterday’s selloff ahead of the release of multiple delayed economic reports and NVDA earnings in the back half of the week.

There were no notable economic reports or material market moving headlines overnight.

Today, there are multiple economic reports due to be released but only some will actually “print” due to the lingering effects from the government shutdown. They include Import Prices (E: -0.1% m/m), Industrial Production (E: -0.1%), Housing Market Index (E: 37), and Factory Orders (E: 1.4%).

Additionally, there are a couple Fed officials scheduled to speak: Barr (10:30 a.m. ET), and Barkin (11:00 a.m. ET) and more late-season earnings due to be released including: HD ($3.81), BIDU ($0.91), BRBR ($0.54), SQM ($0.68).

In order for markets to stabilize, markets will be looking for solid economic data trends, less-hawkish Fed chatter, and strong earnings numbers. Otherwise, the selling pressure could continue into the critical release of Q3 earnings from NVDA tomorrow.