Futures prices traded in contango last month, when the May contract settled at a negative price on April 20, a day ahead of its expiration. “There was limited refinery demand and clearly…” said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
“A vaccine would be a bullish game changer, and stocks reacted accordingly,” Tom Essaye, author of “The Sevens Report” newsletter, wrote in a note. “But one day doesn’t make a…” Click here to read the full article.
What’s in Today’s Report:
U.S. equity futures are up more than 1% this morning, recovering the bulk of yesterday’s late afternoon declines amid continued hopes for a looming economic recovery.
Economically, Japanese Machine Orders for March declined -0.4% after rising 2.3% in February while inflation statistics in Europe were on the soft side, but none of the data materially moved markets overnight.
There are no notable economic reports today however the Treasury will hold a 20-Year Bond Auction at 1:00 p.m. ET, and as we have seen so far this year, any resulting move in yields (specifically the curve) could influence equity market trading.
There are also a few potential Fed catalysts today with two speakers on the schedule: Bostic (10:00 a.m. ET) and Bullard (12:00 p.m. ET), and the release of the FOMC meeting minutes at 2:00 p.m. ET.
The market remains primarily focused on the still very fluid coronavirus outbreak situation and economic reopening process, as well as any further developments about vaccines or treatments. Any positive headlines, specifically regarding the latter, could help power stocks to fresh multi-week highs today, while contrarily, negative news could see a repeat of yesterday’s late day selloff.
What’s in Today’s Report:
Futures are modestly lower this morning as yesterday’s sizeable stock market gains are digested amid simmering tensions between the U.S. and China after President Trump threatened to cut funding to the WHO late yesterday.
Economically, the German ZEW Survey’s Current Conditions Index fell to -93.5 vs. (E) -87.8 while Business Expectations firmed to 51.0 vs. (E) 33.5, underscoring both the economic fallout from the COVID-19 pandemic as well as the broad hopes for a swift recovery.
Today, there is one economic report due out: Housing Starts (E: 968K) but investor focus will be on Capitol Hill where Fed Chair Powell and Secretary Mnuchin are set to testify at 10:00 a.m. ET regarding the stimulus efforts to support the economy in the aftermath of the coronavirus pandemic.
Later in the afternoon, there is one other Fed speaker to watch: Rosengren (2:00 p.m. ET) but things should be relatively quiet following the Powell and Mnuchin’s testimony this morning.
While that phrase may sound pretty scary to investors, Sevens Report’s Tom Essaye said Thursday stock prices may hold up much better in 2020 than during the previous two extended U.S. recessions.
“That’s $2.6 billion in two months, compared to $3.5 trillion in six years! And, the Fed isn’t done, either, as the balance sheet will certainly eclipse $7 trillion soon. Point being, this is very, very…” Essaye said. Click here to read the full article.
What’s in Today’s Report:
Futures are sharply higher as economic reopening continued across the U.S. over the weekend, with more states announcing reopening and easing social restrictions.
The reopening headlines over the weekend were numerous, but there wasn’t any new news that implied the economic might return to normal sooner than expected, and beyond the short term, when the economy returns to normal remains the key unknown for this market.
Fed Chair Powell gave an interview on 60 Minutes that was cited as “positive” but he didn’t say anything new that wasn’t already communicated in his comments last week.
Economic data was sparse and isn’t moving markets.
Today there are no economic reports and no market moving Fed speakers, so headlines on economic reopening, U.S./China relations and the coronavirus should move markets.
What’s in Today’s Report:
Futures are modestly lower following mixed Chinese economic data as markets digest Thursday’s rebound.
Chinese economic data was mixed but not worse than feared, as Industrial Production beat estimates (3.9% vs. (E) 1.5%) while Retail Sales and Fixed Asset Investment both declined sharply (-7.5% and –3.8% respectively) but no worse than expected. In sum the data was “good enough” to keep hope alive that the U.S. economy can see a substantial economic rebound in the coming months, assuming no “second wave” of virus infections.
Today will be an important day for economic data, and the reports we’re watching today (in order of importance) are: Empire State Manufacturing Survey (E: -65.0), Retail Sales (E: -11.2%), Consumer Sentiment (E: 66.0), Industrial Production (E: -11.5%), and JOLTS (E: 5.900MM).
Empire Manufacturing Report and Consumer Sentiment are May reports, so markets will want to see hints of improvement to confirm the economic “worst” will soon be behind us. If that happens, stocks can hold Thursday’s gains.
What’s in Today’s Report:
Futures are little changed as markets digest Wednesday’s uptick in concern about future economic growth and the subsequent market selloff.
Positively, corporate news was solid overnight as CSCO earnings were fine and Mastercard said it’s starting to see the beginning of a recovery in certain sectors.
Economic data was sparse overnight as the only notable number was German CPI, which rose 0.4% vs. (E) 0.3%.
Today, the key will again be the Jobless Claims data (E: -2.500MM). First and foremost, claims need to continue to decline from the previous week, and if the number beats estimates that will help offset some of the concerns about future growth. There are also two Fed speakers today, Kashkari (1:00 p.m. ET) and Kaplan (6:00 p.m. ET), but neither should move markets given we heard from Powell yesterday.
Tom Essaye interviewed with Yahoo Finance’s Alexis Christoforous & Brian Sozzi, discussing oil, airlines, energy, tech & more. Click here to watch the full interview.
What’s in Today’s Report:
Futures are staging a rebound this morning after yesterday’s late day plunge in stocks as tensions between the U.S. and China simmer while investors weigh the risk-reward dynamics of reopening global economies.
Economic data remained fairly dismal overnight but not as bad as feared with U.K. Monthly GDP dropping -5.8% vs. (E) -7.0% while EU Industrial Production fell -11.3% in March vs. (E) -12.0%. Despite the data topping estimates British 2-Yr yields notably fell to a record low of –0.045%.
Today there is just one economic report due out ahead of the open: PPI (E: -0.5%) and it shouldn’t materially move markets especially with investors primarily focused on Fed Chair Powell’s virtual participation in a webcast at 9:00 a.m. ET that will include a Q&A session at the end.
The only other catalyst on the calendar is a 30-Yr. Bond auction by the Treasury at 1:00 p.m. ET. As we saw yesterday, the very strong demand for 10 Yr. Notes pressured yields and weighed on stocks in the early afternoon and we could potentially see a repeat of that today.