Both oil and natural gas are expected to continue higher in the months ahead as fundamentals decidedly favor…said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
U.S. equity futures are decidedly lower this morning as Treasury yields continue this week’s surge higher. The 10-year note yield topped 1.52% in overnight trading which is weighing heavily on high valuation tech names today.
From a catalyst standpoint, today is lining up to be a busy day with a slew of economic data due to be released: International Trade in Goods (E: -$87.0B), Case-Shiller Home Price Index (E: 1.6%), FHFA Home Price Index (E: 1.5%), and Consumer Confidence (E: 114.8).
Of those releases, the market will be most interested in whether or not Consumer Confidence can stabilize following the disappointing August print.
There is a 7-Year Treasury Note action at 1:00 p.m. ET and given how much bonds are influencing stocks so far this week, the results could impact equity markets (strong demand would help stabilize stocks, weak demand would likely see losses extended).
Finally, there are multiple Fed speakers today including: Evans (9:00 a.m. ET), Powell (10:00 a.m. ET), Bullard (1:40 & 7:00 p.m. ET), and Bostic (3:00 p.m. ET). Focus will clearly be on Powell and any insight he may provide regarding inflation expectations and the Fed’s plans to react.
Bottom line, the stock market is being driven by the bond market this week and if we see bonds continue to drop (yields spike higher) then that will result in further underperformance by growth stocks and drag the broader market lower while stabilization in yields would likely allow for a rebound.
Sevens Report Q3 Quarterly Letter Coming October 1st.
The Q3 2021 Quarterly Letter will be delivered to advisor subscribers on Friday, October 1st.
With Fed tapering, Washington budget battles and possible tax hikes looming, Q4 could be the most volatile of the year. Our quarterly letter will help you set the right expectations for clients so they aren’t blindsided by any market volatility.
It’s now clear that Chinese officials won’t allow a disorderly default, and that’s really all global markets care about…money manager Tom Essaye, president of Sevens Report Research wrote. Click here to read the full article.
Value and cyclical sectors have given back some of their early-year outperformance in recent weeks, but as long as bond yields begin to rebound, value and cyclicals should outpace growth…said Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are slightly higher following a quiet weekend as the market’s focus turns to politics this week.
Democrats must pass a “Continuing Resolution” by Thursday to avoid a government shutdown, and while markets expect it will pass, there was little actual progress on that front over the past several days.
Economic data was sparse overnight and isn’t moving markets.
Today we get Durable Goods (E: 0.6%) and there are two Fed speakers, Evans at 8:00 a.m. ET and Williams at 9:00 a.m. ET & 12:00 p.m. ET, but really the market’s focus will be on Washington. Despite the lack of progress from Democrats so far on passing a “Continuing Resolution” to fund the government before the deadline on Thursday night, markets fully expect that “CR” will pass by then. But, if it becomes apparent it not might not pass by then, that will cause more stock market volatility.
The losses quickly spread to broader markets as experts began to warn that…wrote market analyst Tom Essaye, author of the Sevens Report, in a note last week. Click here to read the full article.
The losses quickly spread to broader markets as experts started warning its default could…market analyst Tom Essaye, author of the Sevens Report, wrote in a note last week. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower as markets digested the rally of the past two days, following underwhelming economic data and earnings overnight.
Nike (NKE) became the latest major company to cut guidance on margin concerns and supply chain issues and the stock dropped nearly 5% after hours.
Japanese flash manufacturing PMI missed estimates at 51.2 vs. (E) 52.0 mirroring the loss of momentum from global flash PMIs.
Today focus will remain on China headlines (although Evergrande is fading as a major market influence) and on multiple Fed speakers: Mester (8:45 a.m. ET), Powell, Bowman, Clarida, George (10:00 a.m. ET), and Bostic (12:00 p.m. ET). Finally, we also get New Home Sales (E: 708K) but that shouldn’t move markets.
But it operates like one large company. Yes, there are “private” banks in China and yes, there are “private” corporations, but in the end the Communist Party…wrote Sevens Report Research president Tom Essaye in a note last week. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately higher as the rally continued overnight as China injected more liquidity into their economy.
Chinese officials injected another 17 billion yuan into the economy to prevent any liquidity issues, as it’s now clear that Chinese officials won’t allow a disorderly default (and that’s really all global markets care about).
Economic data disappointed as both the EZ and UK flash composite PMIs missed expectations (EZ PMIs fell to 56.1 vs. (E) 58.9 while UK PMI dropped to 54.1 vs. (E) 54.7).
Focus today will be on economic data, specifically the Flash Composite PMI (E: 55.5) and Jobless Claims (E: 309K). Markets will want to see both numbers confirm what the Philly Fed and Empire survey implied last week, namely that the surge in COVID cases was a temporary and limited headwind on the economy. If that’s the case the rebound in stocks should continue.