Tom Essaye Interviewed with Fox Business on April 15, 2019
Sevens Report founder Tom Essaye says the market can still rally despite disappointing bank earnings. Watch the full clip here.
Economic Breaker Panel: April Update
What’s in Today’s Report:
- Economic Breaker Panel Update – More Improvement
- Earnings Review – Not the Greatest Start
Futures are tracking international shares higher this morning amid dovish central bank speak and earnings optimism.
Both Evans and Rosengren made dovish comments regarding inflation which is helping influence mild risk-on money flows this morning.
Economically, the German ZEW Survey was mixed as the headline weakened for a seventh straight month while the forward looking business expectations rose for the sixth time in a row.
Today, there are two economic reports to watch: Industrial Production (E: 0.3%) and the Housing Market Index (E: 63), and Kaplan speaks at 2:00 p.m. ET.
Earnings however will remain the primary market focus with notable reports being released from BAC ($0.65) ahead of the bell and NFLX ($0.57) and IBM ($2.21) after the close. With a mixed start to the season, if we do not see corporate results begin to improve, underwhelming earnings will become a growing headwind on equities this week.
S&P 500 Back At 2900: What’s Changed Since October
What’s in Today’s Report:
- S&P 500 Back At 2900: What’s Changed Since October.
- Weekly Market Preview (All About Earnings)
- Weekly Economic Cheat Sheet (More Important Chinese Data)
- I’ll be joining Liz Claman on Countdown to the Closing Bell at 3:55 p.m. today on Fox Business to Discuss the Markets. Tune In!
Futures are flat following a quiet weekend as markets digest last week’s rally.
Expectations of a U.S./China trade deal continue to rise, with some anticipating an announcement this week. The WSJ, Reuters and others had positive articles this morning. But, as a reminder, the market has already priced in a deal, so the real focus of any announcement will be when tariffs are removed, and the sooner, the better.
There was no notable international or U.S. economic data overnight.
Today there is one notable economic report, Empire State Manufacturing Index (E: 6.8) and one Fed speaker, Evans at 8:30 a.m. & noon. Given that somewhat light calendar, focus will be on earnings, and some numbers we are watching today include: C ($1.78), GS ($5.05), JBHT ($1.25). If data and earnings are solid, this rally can continue.
The Easiest Way to Explain This Market To Clients
What’s in Today’s Report:
- The Easiest Way To Explain This Market To Clients
- Technical Market Update (Volume Not Confirming The Rally)
- A More “Hawkish” Fed than we think?
Futures and global markets are moderately higher as global economic data beat expectations, furthering hopes of a global growth rebound.
March Chinese exports handily beat estimates, rising 14.2% vs. (E) 8.4% while EU Industrial Production wasn’t as bad as feared (-0.2% vs. (E ) -0.6%).
Focus turns to earnings this morning as all eyes will be on three big banks: JPM ($2.32), WFC ($1.08), PNC ($2.59). If they post solid numbers, then combined with the good Chinese economic data, we could see an extension of this rally.
Outside of earnings, we do get Import/Export Prices (E: 0.4%/0.3%) and Consumer Sentiment (E: 98.0). Plus, Powell speaks to House Democrats but no comments on policy are expected and none of those events should move markets.
Tom Essaye Quoted in CNBC on April 11, 2019
“This met current market expectations,” said Tom Essaye, founder of The Sevens Report. “But Fed officials also didn’t see any need to cut rates at this point either, and there wasn’t even much of a discussion…” Click here to read the full article.
Tom Essaye Quoted on Market Watch on April 12, 2019
Tom Essaye quoted in MarketWatch to share his view on earnings season. “Bottom line, this earnings season is make or break for this market, because we need earnings growth to resume if the S&P 500 is going to…” Click here to read the full article.
Contrarian Opportunity in Permian Shale Stocks?
What’s in Today’s Report:
- FOMC and ECB Takeaways (Both Dovish As Expected, But Neither Will Help Stocks Rally)
- An Opportunity in Permian Shale Energy Stocks?
- Energy Market Update – Solidly Bullish
Futures are slightly lower following another quiet night as markets look ahead to Chinese exports and bank earnings coming tomorrow.
More progress was made in U.S./China trade talks according to the WSJ and a deal is imminent, but the market already assumes that so it didn’t cause a rally.
Chinese and German CPIs both met expectations.
Today there are two economic reports, Jobless Claims (E: 211K) and PPI (E: 0.4%, 0.2%) but neither should move markets. So, focus will be on a lot of Fed speak, specifically Clarida (9:30 a.m. ET) and Williams (9:35 a.m. ET) (Bullard and Bowman also speak today but they aren’t considered Fed “leadership”). If Clarida and Williams talk more about an “average” inflation target, that might put a mild tailwind on stocks as it hints at a more dovish Fed in the future (something we didn’t see in the Minutes yesterday).
Tom Essaye Quoted in Barron’s on April 9, 2019
“It is a very quiet morning with stock futures trading slightly lower while most overseas markets edged higher overnight as investors look ahead to catalysts later in the week,” writes The Sevens Report’s Tom Essaye. Click here to read the full article.
Earnings Preview: Good, Bad, Ugly
What’s in Today’s Report:
- Earnings Season Preview: The Good, the Bad, and the Ugly
Futures are drifting higher this morning while overseas markets were mixed during a quiet night of trading as investors look ahead to a busy calendar of events today.
There were a few economic releases o/n but none materially moved markets with international focus on this morning’s ECB Announcement (7:45 a.m. ET) and Draghi’s press conference afterwards where he is expected to shed light on TLTRO plans.
Looking into the U.S. session today, it is shaping up to be a busy one. In chronological order, there is one economic report ahead of the open: CPI (E: 0.3%, 0.2%), weekly EIA data is due out at 10:30 a.m. ET, and the Fed’s Quarles is schedule to speak at 11:50 a.m. ET.
Moving to the afternoon, there is a 10-Year Treasury Note Auction at 1:00 p.m. ET and if the outcome moves yields materially, stocks will likely follow. Then, the FOMC March Meeting Minutes are due out at 2:00 p.m. ET and the Fed’s Kaplan speaks later this evening: 7:00 p.m. ET.
With so many moving parts today, it will be important to keep an eye on yields as the bond market will offer the best read of how investors are digesting all of the day’s events.
Specifically, the 10 year yield has stabilized at 2.50% recently and if it can move higher, stocks could grind higher as well, however, if yields begin to drop like they did two weeks ago, volatility is likely to rise again, potentially significantly.
Sevens Report Quoted in Market Watch on April 9, 2019
The Energy Information Administration report on U.S. petroleum supplies due Wednesday “will likely be the most-important catalyst for the energy market this week. The closure of the Houston Ship Channel in recent weeks has likely skewed…” wrote analysts at the Sevens Report. Click here to read the full article.
