Tom Essaye, founder of the Sevens Report Research, partly credited expectations for further economic supportive measures from China for the market’s gains. “Chinese Vice Premier Hu called for more stimulus…” Click here to read the full article.
The Sevens Report’s Tom Essaye said this week that the trade war is one of several key uncertainties creating volatility in the market. A major divide seems to exist between market expectations for three…Click here to read the full article.
Tom Essaye, the founder and president of Sevens Report Research in Palm Beach Gardens, Florida, says last weekend’s G-20 finance ministers and central bank governors meeting produced no progress on U.S.-China trade, and there are no…Click here to read the full article.
“Momentum can carry this market higher especially into the Trump/Xi G20 summit, but the bigger (and longer-term more important) question regarding…” says Tom Essaye. Click here to read the full article on CNBC.
What’s in Today’s Report:
Futures are modestly lower following a night of bad micro and macro-economic news.
On the micro front, Broadcom (AVGO), a major semi-conductor company, missed earnings and provided ugly guidance for 2H ‘19, citing the trade war as a major negative on demand.
On the macro front, Chinese economic data was on balance disappointing as Fixed Asset Investment and Industrial Production both missed estimates, although Retail Sales was a mild beat.
Looking ahead to today, the major number is the Retail Sales report (E: 0.7%), and the market would welcome a slightly disappointing number as it would further solidify the expectations for a Fed rate cut in July, and likely spur a rebound this morning. We also get Industrial Production (E: 0.2%) and Consumer Sentiment (E: 98.4) this morning as well.
Tom Essaye quoted in Seeking Alpha. Analysts are also starting to reassess the June market comeback, with some saying it doesn’t quite make sense. “This rally is not fundamentally backed. Instead what we are seeing is a…” Click here to read the full article.
“This rally is not fundamentally backed. Instead what we are seeing is a bunch of people getting swung around and now they are chasing stocks higher,” said Tom Essaye. Click here to read the full article.
What’s in Today’s Report:
Futures are marginally higher following a busy night of news, but none of it shifted the current market outlook.
If there is a “reason” for the gains this morning it’s hopes for more Chinese stimulus as Chinese Vice Premier Hu called for more stimulus to help the economy, although no specifics were given and China’s already been aggressively stimulating the economy for months – so this isn’t exactly incremental news.
Geo-politically, Brent crude oil surged 3% after two tankers were attacked via a torpedo and mine strike overnight in the Gulf of Oman (near the mouth of the Strait of Hormuz). It’s unclear who is responsible at this point but that’s obviously increasing tensions in an already unstable part of the globe.
The remaining big event for the week comes tonight via the Chinese economic data, so today will be spent watching the headlines for any trade updates, while on the economic front we get Jobless Claims (E: 216K) and Import & Export Prices (E: -0.3%, 0.1%), but neither should move markets materially. Finally, there is a 30 Yr. T-Bond Auction at 1:00 p.m. ET and we’ll be watching to see if there are any signs of a Chinese “buyers strike” for Treasuries (so far, it’s not happening).
“The dominant trend remains bearish as U.S. oil supply is up more than 10% this year, and…” says Tyler Richey, co-editor of Sevens Report Research, told MarketWatch. Click here to read the full article.
Tom Essaye was quoted in CNBC on June 11, 2019. “You had a market that became very pessimistic and then all of a sudden we had the Fed’s dovish rhetoric and no Mexican tariffs, and that’s basically causing a squeeze…” Click here to read the full article.
