Jobs Day (A Critical Day for Markets)

/in , /by

What’s in Today’s Report:

  • Jobs Report Preview (Abbreviated Version)
  • December Retail Sales Takeaways – Consumer Spending Sputtered into Yearend

Stock futures are trading cautiously higher with focus on the delayed release of today’s January jobs report following a quiet night of news.

Economically, Chinese CPI cooled to 0.2% Y/Y vs. (E) 0.4% in January, down from 0.8% Y/Y in December, a favorably “cool” inflation print but one that is not materially impacting markets ahead of the BLS report today.

This morning, traders will be keenly focused on the tardy release of the January BLS Employment Situation Report: (E: +67K Job Adds, 4.4% UE Rate, +3.6% Wage Growth). After a swath of soft labor market reports last week, markets will want to see a solid/”Goldilocks” dataset today to ease worries about a sudden downturn in the labor market while a “too-hot” release could spark hawkish money flows and subsequent volatility in equity markets.

Looking beyond the jobs report, there is a 10-Yr Treasury Note auction at 1:00 p.m. ET that will offer a good read on the bond market’s interpretation of the latest BLS report. Solid demand will shore up expectations for an accommodative Fed stance in 2026 and support risk assets today.

On the Fed front, there are three officials speaking today: Schmid (10:10 a.m. ET), Bowman (10:15 a.m. ET), and Hammack (4:00 p.m. ET), and markets will be looking for clues as to when the FOMC will cut rates next amid the fresh context of today’s jobs numbers.

Finally, earnings season continues with SHOP ($0.41), MCD ($3.04), TMUS ($2.03), APP ($2.89), CSCO ($0.82), and ALB ($-0.40) all due to report Q4 results today.

 

Jobs Report Preview: Why Markets Need a Solid Number

/in , /by

What’s in Today’s Report:

  • Jobs Report Preview: Why Markets Need a Solid Number

U.S. stock futures are little changed as the ~2.5% rally off last week’s lows is digested ahead of key economic data.

Economically, the NFIB Small Business Optimism Index dipped -0.2 points to 99.3 vs. (E) 99.8 in January.

Focus today will turn back to economic data via Retail Sales (E: 0.4%).  Put simply, consumer spending is the engine of growth for the U.S. economy and a solid retail sales number will reinforce the currently stock-positive Goldilocks economy.

In addition to data, we do get two Fed speakers today, Hammack (12:00 p.m. ET) and Logan (1:00 p.m. ET) but they are unlikely to move markets.

Finally, earnings season rolls on and some notable reports today include: KO ($0.56), SPOT ($2.95), CVS ($0.99), HOOD ($0.63), F ($0.17), LYFT ($0.13).

 

Can the Market Hold Up Despite Tech Weakness?

/in , /by

What’s in Today’s Report:

  • Can the Market Hold Up Despite Tech Weakness?
  • Weekly Market Preview: Does Tech (and especially software) stabilize?
  • Weekly Economic Cheat Sheet: An Important Week for Growth and Inflation

Futures are modestly lower as markets digest Friday’s big rally following a generally quiet weekend of news.

Politically, Japan’s LDP party won a landslide victory, increasing stimulus expectations. But, positively, the yen and Japanese government bonds are stable as the results largely met expectations.

There were no notable economic reports overnight.

This week is a busy and important one from an economic data standpoint but it starts quietly, as there are no notable economic reports today.

So, focus will be on the tech sector and if it can extend Friday’s rebound (the SaaS names like WDAY, CRM, NOW, remain the key to tech stabilizing in the near term).

On the Fed front, there are two speakers today, Bostic (10:50 a.m. ET) and Waller (3:15 p.m. ET) and some earnings (CLF ($-0.62), APO ($1.91), ON ($0.62)) but barring any surprises, they shouldn’t move markets.

 

Making Sense of Liquidity, Volatility and the S&P 500

/in , /by

What’s in Today’s Report:

  • Making Sense of Liquidity, Volatility and the S&P 500

Futures are moderately higher as markets try to bounce following a decent night of earnings.

AMZN (down –7% pre-market) earnings underwhelmed but most of the other reports overnight were solid, prompting traders to buy the dip overnight.

Economically, German Industrial Production missed estimates, falling –1.9% vs. (E) -0.3%.

The jobs report scheduled today has been delayed till Wednesday thanks to the government shutdown, so the economic calendar today only contains Consumer Sentiment (E: 55.5), Consumer Credit (E: $8.4B) and one Fed speaker, Jefferson (12:00 p.m. ET).  Barring any major surprises, none of those events should move markets.

So, the performance of tech is likely to determine if this early bounce in the broader market can hold.  If tech stocks (especially software stocks) can hold early gains and add to them, then we could see a solid bounce across markets.  However, if they roll over shortly after the open, brace for another potentially ugly day.

 

Why Tech Declined Again

/in , /by

What’s in Today’s Report:

  • Why Tech Declined Again
  • New and Notable ETFs

Futures are little changed despite more mixed tech earnings.

GOOGL reported solid results but slightly underwhelming guidance while QCOM outright disappointed and both stocks are lower as tech sentiment remains uncertain.

Today the calendar is busy with a Bank of England Rate Decision (E: No Change) and ECB Rate Decision (E: No Change) before the open.

Economically, we have two labor reports via Jobless Claims (E: 212K) and JOLTS (E: 7.25M) and they key here is stability (meaning no substantial deterioration).  There is also one Fed speaker, Bostic (10:50 a.m. ET), but he shouldn’t move markets.

Finally, earnings season continues and the key report today is AMZN ($1.98) and the market could really use a strong report this afternoon.  Other notable reports include: COP ($1.08), BMY ($1.15), CMI ($5.20), CI ($7.87),   RBLX ($-0.49).

 

Is AI Enthusiasm Starting to Wane?

/in , /by

What’s in Today’s Report:

  • Is AI Enthusiasm Starting to Wane?

U.S. futures are modestly higher as traders digest yesterday’s heavy selloff in tech/software names while Chinese economic data topped expectations overnight.

Economically, China’s January Services PMI firmed to 52.3 vs. (E) 51.5 from 52.0 in December.

There are multiple economic reports due out this morning including the ADP Employment Report (E: 45K), Final January Composite PMI (E: 52.8), and ISM Services PMI (E: 53.8). As has been the case recently, the stronger the data the better for stocks.

Additionally, there are two Fed officials scheduled to speak today: Barkin (12:00 p.m. ET) and Cook (6:30 p.m. ET), and while markets have been waiting for commentary out of Warsh, any dovish-leaning comments should be supportive of risk assets.

Finally, earnings season continues with UBER ($0.79), LLY ($6.99), ABBV ($2.66), GOOG ($2.58), ARM ($0.21), QCOM ($2.80), and MCK ($9.31) all due to release Q4 results today.

 

An Easy Way to Monitor Concerns About AI ROI

/in , /by

What’s in Today’s Report:

  • An Easy Way to Monitor Concerns About AI ROI
  • ISM Manufacturing PMI Takeaways

Futures are trading higher with tech leading after PLTR and Samsung both posted very strong Q4 earnings results while a stabilizing precious metals market and optimism Congress will pass a spending bill are bolstering sentiment.

Economically, French CPI fell to +0.3% Y/Y in January vs. (E) +0.7%, down from +0.8% in December which is easing concerns about higher-for-longer central bank policy rates.

Today, there was one important economic report due to be released: JOLTS (E: 7.245 million) but it will be delayed due to the government shutdown.

The only other potential macro catalysts are a 6-Week Treasury Bill auction at 11:30 a.m. ET and the Fed’s Barkin scheduled to speak before the open (8:00 a.m. ET) however, neither will likely move markets meaningfully with focus on the spending bill in Congress/government shutdown.

Finally, earnings season continues with quarterly reports due from PYPL ($1.29), PEP ($2.24), MRK ($2.03), AMGN ($4.75),  AMD ($1.11), and SMCI ($0.41) today.

 

Does the Warsh Nomination Jeopardize the Rally?

/in , /by

What’s in Today’s Report:

  • Does the Warsh Nomination Jeopardize the Rally?
  • Weekly Market Preview: Is the Goldilocks Economy Still Rolling?
  • Weekly Economic Cheat Sheet: “Big Three” Monthly Reports This Week (Including Jobs Friday)

Futures are moderately lower on momentum from Friday’s decline as markets digest the surprise Warsh nomination.

Geopolitical headlines were mixed as the government partially shutdown (but should be brief) while fears of a strike against Iran receded on positive Trump comments.

Economically, Chinese Feb. PMIs missed estimates and both the manufacturing and services PMIs fell below 50.

Today focus will be on the ISM Manufacturing PMI (E: 48.3) as that is the first of the big monthly economic reports, and the stronger the data, the better for stocks.

We also have one Fed speaker today, Bostic (12:30 p.m. ET), but he shouldn’t move markets (the market just wants to hear from Warsh now)

Earnings continue on, meanwhile, and some key reports today include: DIS ($1.57), PLTR ($0.17), NXPI ($2.93).

 

Market Based Inflation Expectations Post-Fed

/in , /by

What’s in Today’s Report:

  • Market Based Inflation Expectations Post-Fed

Futures are moderately lower on the news that President Trump will nominate Kevin Warsh as Fed Chair.

The Warsh nomination is a surprise (Waller and Rieder were the favorites) and he’s not the market’s first choice, as Warsh has been hawkish on the use of QE in the past.

Staying with politics, a deal apparently has been reached to avoid a government shutdown (which is a positive).

Today focus will be on the President’s Fed announcement and, again, while Warsh isn’t a negative for markets, it wasn’t the market’s first choice and that is why we’re seeing profit taking in gold and silver this morning (gold down 3%).

Outside of the Fed, we do get PPI (E: 0.2% m/m, 2.9% y/y) and some notable earnings from lenders/credit card companies: SOFI ($0.12) and AXP ($3.55).  Good commentary about consumer spending will be welcomed by the markets.

 

Another “Run Hot” Policy (Weaker Dollar)

/in , /by

What’s in Today’s Report:

  • Another “Run Hot” Policy (Weaker Dollar)
  • What the Fed Decision Means for Markets

Futures are modestly higher on better than expected mega-cap tech earnings and reduced shutdown risks.

Big tech earnings weren’t perfect but, on balance, were positive as META (up 10% pre-open) and TSLA (up 2% pre-open) beat while MSFT (down 7% pre-open) disappointed.

Shutdown risks fell on reports that President Trump and Senate Minority leader Schumer were close to a deal to extend government funding.

Focus today will be on Jobless Claims (E: 205K) and another round of important earnings.

Potentially market moving reports today include:  AAPL ($2.65), V ($3.14), MA ($4.20), SNDK ($3.31), CAT ($4.67), LMT ($6.24) and BX ($1.52).