Tom Essaye, founder and president of Sevens Report Research, joins BNN Bloomberg with his market outlook. He says he’d buy… Click here to watch the full interview.
Futures are marginally higher following another night of…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately higher thanks to solid economic data and better than expected earnings.
The EU flash PMI was stronger than expected at 60.6 vs. (E) 60.0, while good UK Retail Sales (0.5% vs. (E) 0.4%) helped offset the soft UK flash PMI (57.7 vs. (E) 61.9). But, on an absolute basis the numbers were good, and importantly the economic recovery is still on going and has good momentum.
Earnings were good in aggregate overnight with strong reports from TWTR and SNAP, among others.
Today the key number will be the July Flash Composite PMI (E: 63.4) and markets will want “Goldlocks” data. Specifically, that means strong activity that implies the rise in COVID cases isn’t hurting the recovery, while at the same time, activity that isn’t so strong it makes the Fed think about tapering sooner than expected, or more forcefully.
Earnings season also continues today, and four reports we’ll be watching include: NEE ($0.67), AXP ($1.64), SLB ($0.25), and HON ($1.94).
This market is vulnerable to a bigger pullback or correction if there’s a new… warns Sevens Report Research founder Tom Essaye. Click here to read the full article.
Tuesday, markets seemed to calm, with equity futures rising. Equity futures are…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are marginally higher following another night of generally solid earnings and ahead of the ECB decision.
Delta variant fears continued to recede as governments appear to be focusing on re-masking as a policy response, not economic restrictions.
Today focus will be on the ECB Rate Decision & Press Conference (7:45 & 8:30 a.m. ET) and economic data via Jobless Claims (E: 350k) and Existing Home Sales (E: 5.90M). Markets will want to see a dovish ECB and continued improvement in claims to reinforce that the global recovery is on going, and that central banks will remove accommodation very, very slowly.
On the earnings front, there are several more notable reports today: T ($0.78), AAL (-$1.70), FCX ($0.73), TWTR ($0.07), INTC ($1.06).
What’s in Today’s Report:
Futures are modestly higher thanks to continued momentum from Tuesday’s rebound combined with solid earnings reports.
Earnings overnight were good and importantly companies like CMG and UAL said the increase in COVID cases was not hurting business, which helped reassure markets that the Delta variant isn’t changing consumer’s behavior.
There were no economic reports overnight and there are no economic reports later today, so focus will remain on earnings and COVID trends. If earnings are solid and commentary remains upbeat, and we don’t get any negative COVID headlines, then the rebound can continue today.
Some earnings we’ll be watching today include (in order of importance): TXN ($1.82), JNJ ($2.28), KO ($0.57), VZ ($1.29), STX ($2.87), LVS (-$0.19), CSX ($0.37), DFS ($3.58).
What’s in Today’s Report:
Price action is mixed across asset classes this morning as equity futures are cautiously rebounding with EU shares but bond yields made new lows amid lingering Delta variant fears.
Economically, German PPI fell to 1.3% vs. (E) 1.1% in June, down from 1.5% in May which offers some new support for the transitory inflation thesis.
Economically, there is one report on the real estate market today: Housing Starts and Permits (E: 1.590M, 1.700M) but it should not have an impact on stocks or bonds, and no Fed officials are scheduled to speak.
That will leave trader focus on earnings early with: ALLY ($1.49), PM ($1.54), TRV ($2.35), and SYF ($1.51) reporting Q2 results ahead of the bell and NFLX ($3.16), UAL (-$4.17), IBKR ($0.83) reporting after the close.
Outside of those potential catalysts, the broader market focus remains on the latest developments regarding the Delta-variant of COVID-19 and any subsequent restrictions or lockdowns that may be announced around the globe.
As has been the case in recent weeks, the stock market will likely react to moves in bonds, so if yields begin to extend this morning’s early drop amid new risk-off money flows, expect volatility to remain elevated. Conversely, if bond yields begin to recover meaningfully, then stocks would likely follow, potentially rising back towards Friday’s closing levels.
What’s in Today’s Report:
Futures are moderately lower as more governments implement restrictions in reaction to the Delta COVID variant.
More cities in California reinstituted indoor mask mandates, Australia implemented more lockdowns and select countries in Europe upped restrictions as Delta COVID cases continue to rise, causing concern among investors that the economic recovery might lose momentum.
On infrastructure, the bi-partisan $1 trillion deal is in danger of collapsing as early as this week, which would increase the chances of tax hike headlines over the next month.
There’s only one notable economic report today, the Housing Market Index (E: 82.0), and just two notable earnings reports, AN ($2.65), TSCO ($2.94), so the tenor of COVID headline and infrastructure will drive markets, and if there are more restrictions announced or the bipartisan infrastructure bill dies, expect more weakness in stocks.
Tom Essaye, founder of the Sevens Report, discusses the Consumer Price Index takeaways as well as Powell’s comments. Click here to watch the full interview.
