Tom Essaye interviewed with Ben Lichtenstein with TD Ameritrade on what is driving the market right now and who is it affecting the most: Banks, crude, energy…& more importantly what will it take to turn the market around? Click here to watch the full video.
Tom Essaye quoted in Barron’s on May 21, 2019. “Today’s news was a positive development, but by no means a game-changer for the broader Huawei situation…” Click here to read the full article.
What’s in Today’s Report:
It’s an ugly morning as futures are down about one percent as markets digest disappointment from the week’s two big events, the FOMC Minutes and the global flash PMIs.
EU flash PMIs missed estimates at 51.6 vs. (E) 51.7 but EU and German manufacturing PMIs were especially weak (47.7 & 44.3) and that’s negative for global growth.
Yesterday’s FOMC Minutes were slightly hawkish and confirmed the Fed isn’t close to a rate cut right now.
Given the soft foreign data, the key report today is the flash Composite PMI (E: 52.4). If that number is soft, it’ll further stoke worries about global growth and will be a negative for stocks. Other reports today include Jobless Claims (E: 215K) and New Home Sales (E: 680K).
Bottom line, this market is facing several headwinds and support at 2800 is now important, but should likely hold unless hopes for a Trump/Xi meeting at the G-20 meeting are dashed, or U.S. growth begins to roll over.
What’s in Today’s Report:
U.S. stock futures are flat as investors look ahead to today’s release of the FOMC Minutes while most overseas markets bounced o/n in sympathy with the U.S. rally yesterday, although trade tensions remain elevated.
A NYT article released late yesterday revealed a modest escalation in the “tech war” as the U.S. will likely add several Chinese surveillance companies to the same “blacklist” that Huawei is on. This is an incremental negative as the odds of the broader “trade war” being resolved in the near-term continue to fall amid escalations in the U.S.-China “tech war.”
There are no major economic reports today but the calendar is relatively busy with the EIA Petroleum Status Report due out at 10:30 a.m. ET (oil has traded with a sluggish tone this week and a selloff could drag stocks lower), while the main focus of the session will be on the release of the FOMC Meeting Minutes at 2:00 p.m. ET.
Additionally, there are multiple Fed speakers on the calendar: Williams (10:00 a.m. ET), Bostic (10:10 a.m. ET), and Kaplan (10:15 a.m. ET), however it is unlikely any of them move markets ahead of the Minutes.
Tom Essaye quoted in Barron’s on May 20, 2019. “Several U.S. tech firms have stopped conducting business with Huawei, per the…” Click here to read the full article.
What’s in Today’s Report:
Futures are rebounding with EU markets from yesterday’s sharp, tech-led losses thanks to some encouraging Huawei news o/n and a benign speech by Powell late Monday.
The U.S. announced some temporary exemptions will be issued for companies exporting to Huawei (mainly for existing products) which is helping ease some of yesterday’s elevated trade angst.
Overseas, there were no notable economic reports but the RBA cited risks to global growth in their most recent meeting minutes release, which pressured the aussie.
Looking into today’s U.S. session, focus will largely remain on the trade war and specifically any further information on the Huawei exemptions for U.S. exporters.
There are a few other potential catalysts however, including one economic report: Existing Home Sales (E: 5.37M) and a few Fed speakers: Bostic (7:50 a.m. ET), Evans (10:45 a.m. ET), and Rosengren (12:00 p.m. ET) but none of these are expected to materially move markets amid the most recent trade war developments.
Tyler Richey was quoted in Bloomberg on May 20, 2019. “You’ve got some conflicting influences on the market and the price action today is pretty indicative of that…” Click here to read the full article.
Tom Essaye quoted in CNBC on May 17, 2019. “Through any lens, this is a broadside against the Chinese government, which is generally considered to be the beneficial…” Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower following an uneventful weekend as investors digest Friday’s negative trade headline (that U.S./China trade discussions have been suspended).
On trade, there was no new news over the weekend, but several U.S. tech firms have stopped conducting business with Huawei, per the Commerce Department decision, and that’s just further escalating the U.S./China trade conflict.
Economically, there were no market moving reports (Japanese GDP was stronger than estimates but the details weren’t great).
There are no economic reports today but there are multiple Fed speakers, most important of which is Powell (7:00 p.m. ET), although he’s not expected to make extensive comments on policy. Other Fed speakers today include: Bostic (8:50 a.m. ET), Harker (9:30 a.m. ET), Williams & Clarida (1:00 p.m. ET).
Given the lack of data and important Fed speak, trade headlines should drive markets today and any formal retaliation by China for the Huawei decision will make the trade situation worse, and likely pressure stocks.
Tom Essaye was quoted in Markets Insider on May 15, 2019. The red metal has been the “single-best leading indicator for stocks over the past 18 months,” and is flashing a warning sign for…” Click here to read the full article.
