Oil futures climbed on Friday, erasing previous losses to finish higher for the week. “The Colonial Pipeline debacle got most of the attention from energy traders this week…” said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower following disappointing Chinese economic data.
Chinese economic data joined recent U.S. data in hinting at a possible plateauing recovery and building inflation pressures. Industrial Production rose 9.8% vs. (E) 10.0% while Retail Sales gained 17.7% vs. (E) 25%. Housing Prices, meanwhile, rose 0.48% vs. (E) 0.41%.
Today the Empire Manufacturing Survey (E: 25) is the key report and markets will want to see solid data and stable prices indices. We also get the Housing Market Index (E: 83) but that shouldn’t move markets.
From a Fed standpoint, Clarida (10:05 am ET) is the headliner today while Bostic (10:00 a.m. ET) will also provide comments.
“Futures are moderately higher on momentum from Thursday’s rebound combined with a drop in industrial metals’ prices…” writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately higher on momentum from Thursday’s rebound combined with a drop in industrial metals’ prices, which is helping to ease some anxiety on inflation.
Iron ore prices dropped sharply overnight as Chinese officials stated they would take measures to curb price increases in various industrial metals and that headline is pushing back on the “surging inflation” narrative (although it doesn’t change the inflation outlook).
There was no notable economic data overnight nor any important central bank speak (outside of the China metals news it was a quiet night).
Today we get several notable economic reports including Retail Sales (E: 1.0%), Industrial Production (E: 1.2%), and Consumer Sentiment (E: 90.3). In general, the stronger the better for these reports but we’ll be watching the inflation expectations component of the Consumer Sentiment Index – if it runs “hot” expect a headwind on stocks. There’s also one Fed speaker, Kaplan (1:00 p.m. ET), but he shouldn’t move markets.
What’s in Today’s Report:
Futures are modestly lower mostly on momentum from Wednesday’s drop following a generally quiet night.
There was no new inflation news overnight, but investors are cautious ahead of the PPI report this morning, which should be similarly strong to yesterday’s CPI report.
Bitcoin and the entire crypto-currency space is getting hit hard after Tesla (TSLA) announced it would no longer accept Bitcoin as a form of payment and that’s weighing on some of the momentum parts of the market.
Looking forward to today, the key number will be PPI. Expectations for PPI are 0.3% m/m and 5.9% y/y but if the numbers come in much stronger expect that to send yields higher and to hit stocks, at least temporarily.
The other notable number this morning is Jobless Claims (E: 475K) although that will start to fade a bit in importance as the market views the issues in the labor market as supply based (people not choosing to work) rather than demand based (people not being able to work).
There are also three Fed speakers today Barkin (10:00 a.m. ET), Waller (1:00 p.m. ET), Bullard (4:00 p.m. ET), and any commentary on inflation will be closely watched.
On the other hand, “the threat of stagflation continues to emerge as an underlying market theme, and that is supportive of gold for one main reason…” analysts at Sevens Report Research, wrote in Tuesday’s newsletter. Click here to read the full article.
If the pipeline isn’t back up and running by the end of the week, “we could see gasoline prices go parabolic in the near term, as there are already reports of…” said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Stock futures are under pressure for the third day in a row this morning as inflation fears continue to grip global markets ahead of today’s key April CPI report in the U.S.
Economically, Eurozone Industrial Production missed expectations while both the U.K. Monthly GDP and Industrial Production reports handily topped estimates which is helping the FTSE buck the trend and rally today.
Looking into today’s session, all eyes will be on the April CPI report due out at 8:30 a.m. ET (E: 0.2% m/m, 3.6% y/y). A hot print could spook investors and cause a continuation of the early week’s risk-off money flows.
Later in the session, there are multiple Fed speakers including: Clarida (9:00 a.m. ET), Bostic (1:00 p.m. ET), and Harker (1:30 p.m. ET) however Fed speak has remained decidedly dovish and none of today’s speakers should move markets.
Finally, there is a 10-Yr Treasury Note Auction at 1:00 p.m. ET and the outcome could give investors an idea of how bond traders view inflation in the wake of the CPI report.
Ultimately a soft bond auction and a subsequent rise in yields would likely compound this week’s already elevated inflation concerns and cause more volatility in equity markets while a strong auction could ease those concerns and see a relief rally develop.
Click here to subscribe to a free trial of the Sevens Report.
What’s in Today’s Report:
Futures are down sharply with global shares this morning as positive vaccine headlines were offset by rising stagflation concerns which are weighing heavily on tech names.
PFE was awarded emergency use authorization for its vaccine in 12-15 year-olds, bolstering “re-opening” optimism but also stagflation concerns in the wake of Friday’s weak jobs report.
There were no market-moving economic reports overnight.
Today, there are a lot of moving pieces and potential catalysts. First, there is one economic report: JOLTS (E: 7.455M) as well as a 3-Yr Treasury Note auction at 1:00 p.m. ET. If the labor data shows further signs of weakness and/or the auction is weak, sending yields higher, expect more equity market weakness led by tech.
Additionally, there are multiple Fed speakers: Williams (10:30 a.m. ET), Brainard (12:00 p.m. ET), Daly (1:00 p.m. ET), Bostic (1:15 p.m. ET), and Harker (2:00 p.m. ET). They should not veer too far from the dovish narrative however if any of them do hint at “talking about tapering” or mention inflation becoming a concern, expect more volatility.
What’s in Today’s Report:
Futures are flat following a mostly quiet weekend of news as markets digested Friday’s jobs report, which was a disappointment but isn’t changing the broad market outlook (more on that in the Report).
Commodity prices continued to surge over the weekend, and that’s going to continue to increase inflation pressures. Iron Ore prices rose 10% as China tightened supply amidst the global recovery. Meanwhile, wholesale gasoline prices rose 2% following a cyber-attack that closed the Colonial Pipeline, although the outage isn’t expected to be long-lasting.
Today there are no notable economic reports and only one Fed speaker, Evans (8:30 a.m. ET, 2:00 p.m. ET). So, unless we learn the Colonial Pipeline outage will be long-lasting (which would send gasoline prices sharply higher), I’d expect relatively quiet trading today.
Click here to sign up for a free trial to the Sevens Report.