Two Steps Forward, One Step Back

/in /by

What’s in Today’s Report:

  • What the Italian Deficit Means for Stocks

Futures are modestly lower as the Italian deficit came in larger than hoped.

The official Italian budget produced a deficit of 2.4% of GDP, larger than hoped by markets.  The euro extended its loses from Thursday and German bund yields declined following the announcement.

Economically, EU Core HICP (their CPI) missed estimates, rising 0.9% vs. (E) 1.1.%.

Today focus will be on the Core PCE Price Index (E: -0.1% m/m, 2.0% y/y) as that’s the Fed’s preferred measure of inflation, although barring a number well above 2.0%, it shouldn’t move markets.  Also on the calendar today is Consumer Sentiment (E: 100.8) and one Fed speaker:  Williams (4:45 p.m. ET).

If you are an advisor, gathering all the information everyday to stay on top of the markets can take hours. Sevens Report can simplify this for you. Get daily market analysis emailed you. Try it for two-weeks at no charge and see how we can help you. Go Here.

Fed Takeaways

/in /by

What’s in Today’s Report:

  • Fed Decision Takeaways
  • Why the Italian Budget Matters to You

Futures are slightly higher following a generally uneventful night as markets digested the Fed decision.  Importantly, there was no major follow through to Wednesday’s late sell off.

Economic data didn’t contain any surprises as German Gfk Consumer Climate beat estimates (10.6 vs. (E) 10.4).

Today there are multiple economic reports including Durable Goods Orders (E: 2.2%), Final Q2 GDP (E: 4.3%), Jobless Claims (E: 216K) and Pending Home Sales (E: 0.0%) as well as two Fed speakers, Kaplan (2:00 p.m. ET), Powell (4:30 p.m. ET).  But, Powell just spoke at length yesterday so he shouldn’t say anything too surprising.  Meanwhile, unless we get a very disappointing Durable Goods report, the economic data shouldn’t move markets.

Instead, the Italian budget will be the most important event today, and if the budget deficit prints above 2.5%, that likely will weigh on the euro and boost the dollar, which could be a headwind for stocks.

Sign-up for a free trial and receive daily morning analysis to stay on top of the market. Go here

Fed Wildcard to Watch

/in /by

What’s in Today’s Report:

  • The FOMC Wildcard to Watch: Powell’s Presser
  • The Oil Rally (And How Long It Can Last)

Stock futures are slightly positive this morning ahead of the Fed today while global markets were largely flat after another quiet night of news.

There were no market moving economic reports overnight.

Oil prices are slightly lower this morning after the API reported a +2.9M bbl build in crude stocks vs. (E) -1.3M bbls draw ahead of this morning’s weekly EIA release.

Today, the main market focus will be the Fed Events: FOMC Announcement and Forecasts (2:00 p.m. ET), Fed Chair Press Conference (2:30 p.m. ET) although, there is also one economic report out in the U.S. this morning: New Home Sales (E: 630K).

Barring any bombshell headlines about trade or to a lesser degree, politics, it is likely to be a quiet session with price action being driven by positioning until the Fed starts up at 2:00 p.m. ET.

To read daily market analysis sign-up for a two-week risk-free trial. Go Here

Tom Essaye Quoted in Fox Business on September 25, 2018

/in , /by

The Federal Reserve appears ready to hike interest rates Wednesday for the third time this year, as the central bank responds to rising inflation and robust hiring by U.S. employers. “Something pretty significant would have to happen for the Fed not to hike in December,” said Tom Essaye, founder and editor of The Sevens Report.

Click here to read the full article.

Tyler Richey on U.S. News, September 21, 2018

/in /by

8 Affordable Commodity Stocks to Buy

Trade tensions have hit certain commodities more, with copper one of the commodities to fall. Prices are down 22 percent year-to-date. Tyler Richey, co-editor of the Sevens Report newsletter, says trade war concerns are overshadowing a positive backdrop for copper, as the U.S. and global economy is strong.

Click here to read the full article.

Rate Hike Preview

/in /by

What’s in Today’s Report:

  • FOMC Preview (Key Word: Accommodative)
  • Chart: Brent Crude Hits Multiyear High

US stock futures are pointing to a modest rebound this morning after yesterday’s pullback in the major indexes as US—China trade tensions linger.

On a positive note, the US did sign a revised trade deal with South Korea overnight which slightly improved sentiment towards global trade.

Overseas, markets were mixed but mostly little changed after a quiet night of news as a sense of “Fed Paralysis” takes hold ahead of tomorrow’s FOMC Announcement, Forecasts and Press Conference.

Today’s session is not likely to be a very exciting one with the Fed looming tomorrow but there are some housing market reports due out before the bell: S&P Corelogic Case-Shiller HPI (E: 0.1%), FHFA House Price Index (E: 0.3%) and Consumer Confidence (E: 131.7) will print at 10:00 a.m. ET.

Although it will be quiet, any new trade developments or material political headlines still have the potential to move the market intraday as investors remain very sensitive to those two issues.

Let Sevens Report help you stay on top of the market. Get daily market analysis straight to your inbox at 7am. Sign-up for a two-week risk-free trial today. Go Here

S&P 500 At 3000? (Not So Fast)

/in /by

What’s in Today’s Report:

  • One of Two S&P 500 3000 Conditions Met
  • Why the Dollar and Bond Yields Have Decoupled

Futures are little changed following a night of no new trade news and slightly underwhelming economic data.

Global markets all rallied on momentum from the Thursday gains in the U.S., but nothing new occurred on trade overnight.

Economic data was slightly disappointing as EU Composite PMI (54.2 vs. (E) 54.3) slightly missed estimates while EU Manufacturing PMI (53.3 vs. (E) 54.2) badly missed.

Today focus will be on the U.S. September PMI Composite Flash (E: 55.1), and as always we’ll be looking for stability in the economic data to imply this strong economy isn’t losing momentum.  Additionally,  today is quadruple witching options expiration, so don’t be surprised by big volumes and an uptick in volatility into the close.

Get updates like these daily and stay on top of the markets with Sevens Report. Go Here to sign up for a two-week free trial and see it for yourself.

Yield Curve Update (Positive)

/in /by

What’s in Today’s Report:

  • Bank Update – Positive Catalyst Looming?
  • 10’s-2’s Curve Update (Positive)
  • Weekly EIA and Oil Outlook

Futures are very slightly higher following a quiet night of news.

There was no trade news overnight so cautiously optimistic sentiment towards trade remained in place – and all eyes remain on next week’s U.S./China summit which, for now, is still on.

British Retail Sales was the only notable economic report, and it beat estimates at 0.3% vs. (E) 0.1%, continuing a recent run of good British data.

Today focus will be, of course, on any trade headlines, especially pertaining to next week’s U.S./China trade summit.  Beyond that, we get some notable economic data, starting with Philadelphia Fed Business Outlook Survey (E: 19.2).  We also get Jobless Claims (E: 210K) and Existing Home Sales (E: 5.360M) although neither should move markets.

To get daily updates like this emailed to you directly, sign-up for a two-week free trial. Go Here.

Mind the Gap: US vs. EM

/in /by

What’s in Today’s Report:

  • Mind the Gap: US vs. EM
  • Tariff Update

Futures are drifting mildly lower as investors digest yesterday’s gains while Asian shares played catch up o/n to the not-as-bad-as-feared trade developments that spurred yesterday’s US rally. Otherwise it was a very quiet night.

Economically, British inflation data was firmer than expected as CPI rose to 2.7% vs. (E) 2.4% Y/Y boosting UK yields and the pound, and slightly weighing on the FTSE.

Oil is down modestly after the API showed a +1.2M bbl build late Tuesday vs. (E) -2.1M for the EIA report today.

Today, there will be a few moving pieces in focus including one economic release early: Housing Starts (E: 1.240M), trade talks with Canada (although China remains the main focus), and Emerging Market price action (there is a rate decision in Brazil today).

Some retracement to yesterday’s solid US rally should not be shocking, but as long as tech shares hold up, sentiment towards the trade war doesn’t deteriorate, and volatility in EM doesn’t spike, the general positive trend back towards all-time highs in US stocks should continue in the near term.

To read the full report, sign-up for a free trial today. Click here to proceed.

Tariffs and Valuation

/in /by

What’s in Today’s Report:

  • Tariffs and Valuation

US futures are modestly higher and most overseas markets were little changed to higher overnight as the latest announcement of tariffs on China were largely shrugged off.

Late yesterday, the Trump Administration released the details of the next wave of tariffs on China: 10% on $200B worth of imports going into effect on 9/24/18 increasing to 25% at year-end.

The tariffs go into effect sooner than expected but the 10% rate into year-end leaves plenty of room/time for constructive negotiations which is why global shares are trading “ok” today.

Today, the market focus will be dominated by the new tariffs and what’s next in the trade war. As far as other catalysts go, there is just one economic report: Housing Market Index (E: 67.0) and no Fed officials are scheduled to speak.

To get daily market updates, sign-up for a two-week free trial to Sevens Report today. Click Here to proceed.