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.

 

Can the Rest of the Market Rally If Tech Is Weak?

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What’s in Today’s Report:

  • Can the Rest of the Market Rally If Tech is Weak?
  • Weekly Market Preview: Can AI Enthusiasm Rebound? (NVDA Earnings on Wednesday Are Key)
  • Weekly Economic Cheat Sheet: The First Look at November Data (Flash PMIs on Friday)

Futures are moderately higher mostly on momentum from Friday’s rebound and following a quiet weekend of news.

On trade, there was positive news as the White House confirmed reduced tariffs on numerous food products as it aims to boost affordability.

Economically, the only notable report was Italian CPI which rose 1.3%, as expected.

Today we have the first economic report for November, Empire Manufacturing (6.10), and numerous Fed speakers.  Williams (9:00 a.m. ET) and Waller (3:35 p.m. ET) are the most important speakers today but we will also hear from Jefferson (9:30 a.m. ET), Kashkari (1:00 p.m. ET) and Logan (7:55 p.m. ET).  Bottom line, if Empire manufacturing is stable and the tone of Fed speak today is open to a December cut (especially from Williams and Waller) that should help extend Friday’s rebound.

 

Monthly Bitcoin Update & Outlook

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What’s in Today’s Report:

  • Monthly Bitcoin Update & Outlook

Futures are moderately lower as markets extend Thursday’s selloff mostly on momentum and following some underwhelming economic data.

Chinese economic data was mixed as retail sales (2.9% vs. (E) 2.7%) beat estimates while Industrial Production (4.9% vs. (E) 5.5%) and Fixed Asset Investment (-1.7% vs. (E) 0.9%) missed expectations.

Today there are no notable economic reports but there are three Fed speakers: Schmid (10:05 a.m. ET), Logan (2:30 p.m. ET) and Bostic (9:20 a.m. ET, 3:20 p.m. ET).  If they’re tone is hawkish towards a December rate cut (as the commentary has been this week from multiple Fed officials) that will further pressure stocks.

 

What Caused the Government Shutdown (And Why That’s Important to Markets)

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What’s in Today’s Report:

  • What Caused the Government Shutdown (And Why That’s Important to Markets)

Futures are slightly lower despite strong CSCO earnings and the government officially reopening.

CSCO posted solid results and the stock is up 6% pre-market but the recent AI skepticism remains in place and the earnings aren’t keying a broader rally.

Politically, the government shutdown officially ended, removing what was an increasing economic headwind.

There are no economic reports today (now that the government is reopened, we will await a new schedule of backlogged releases) but there are several Fed speakers:  Daly (8:00 a.m. ET), Kashkari (10:30 a.m. ET), Musalem (12:15 p.m. ET) and Hammack (12:20 p.m. ET).  If their commentary further pushes back on expectations for a December rate cut, that will pressure stocks.