The Country Garden news reinforced the notion that “recession risks in China are real,” explained Sevens Reports’ Tom Essaye. Click here to read the full article.
Sevens Report analyst Tom Essaye explained in a Wednesday note that the credit downgrade by Fitch “should have a limited near-term impact”. Click here to read the full article.
Sevens Report: “We and others said at the start of the year that economic data would drive this market in 2023, and that’s what’s happened. The data has been Goldilocks, inflation has fallen, and the Fed isn’t worse than feared. But just like those were positive surprises YTD, they can also turn into negative surprises, as anyone who was in this business in ’99-’00 and ’07-’08 can tell you.”
Click here to read the full article.
At that price, the S&P is aggressively pricing in a lot of good things occurring and virtually zero negative surprises, Sevens Report analyst Tom Essaye wrote Tuesday. Click here to read the full article.
What’s in Today’s Report:
U.S. equity futures are lower as the Fed decision continues to be digested while global economic data largely missed expectations overnight.
Economically, Chinese data was universally disappointing with Industrial Production and Retail Sales both missing estimates while EU trade data showed that imports and exports both declined by more than anticipated. China’s central bank cut rates further overnight, however, which saw risk assets in Asia recover to end with gains.
Looking into today’s session, the ECB decision will be in focus this morning (E: +25bp hike) followed by President Lagarde’s press conference. If the ECB is seen as hawkish, it will likely weigh on stocks and other risk assets as it will show central bankers are not yet satisfied with the trends in inflation and more aggressive policy is likely in the months ahead.
In the U.S., there is a slew of economic data due to be released including: Jobless Claims (E: 250K), Retail Sales (E: 0.0%), Philadelphia Fed Manufacturing Index (E: -13.2), Empire State Manufacturing Index (E: -15.1), Import & Export Prices (E: -0.6%, -0.5%), and Industrial Production (E: 0.1%).
And with the Fed leaving future policy plans largely “open” and dependent on economic data, the market will want to see more “Goldilocks” trends with slowing growth and a more rapid decline in price readings.
Sevens Report Alpha: Artificial Intelligence Issue
This week’s Alpha issue focused on a very popular market topic: Artificial Intelligence.
This issue was an update to a March 7th Alpha issue on AI, and the three ETFs we profiled in that report have risen 20%, 17%, and 14%, respectively in just three months!
This week’s AI issue updated and expanded that research as we:
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On a similar note, Sevens Report Research founder Tom Essaye said that “from a technical perspective, there are signs that a potential bottom for the dollar has been formed.” Click here to ad the full article.
Tom Essaye, president of Sevens Report Research, joins BNN Bloomberg to run through his take on prominent companies reporting earnings this week. Click here to watch the full interview.
What’s in Today’s Report:
Futures are modestly higher thanks to more solid tech earnings overnight and some small political progress.
Meta (FB) joined MSFT and GOOGL in posting strong earnings and the stock was up more than 10% overnight.
Politically, House Republicans (barely) passed their debt ceiling bill and now more substantial negotiations can begin with the White House.
Today focus will remain on data and earnings. Economically, the key report today is Jobless Claims (E: 249K), although the financial media will focus more on Q1 GDP (E: 2.0%). But, Q1 GDP is a stale number at this point (it covers Jan-Mar) compared to jobless claims, which will tell us if we’re seeing more deterioration in the labor market. Any move towards, or modestly above, 250k would further hint at labor market deterioration (which would be a mild positive for markets).
Turning to earnings, this remains the busiest week for results and key reports we’re watching today include: AMZN (E: $0.21), INTC ($0.16), CAT ($3.79), AAL ($0.04), MA ($2.71), MRK ($1.34) and MO ($1.19).
“The VIX is trading at the lowest levels since the S&P 500 hit its standing all-time high in the early days of 2022,” Tom Essaye, founder of Sevens Report Research, said. “It will be hard to believe the market is poised to casually cruise towards new record highs from here,” he added. “I.e., the bottom of the bear market is not in.” Click here to read the full article.
Tom Essaye, president of Sevens Report Research, joins BNN Bloomberg to discuss the disparity of the market’s rate cut expectations, and central bank pushback. Click here to watch the full interview.
