What’s in Today’s Report:
- Jobs Report Preview
- Weekly EIA Analysis and Oil Update
S&P futures are extending this week’s “squeezy” rally in early trade as dovish optimism continues to dominate the tape ahead of this morning’s ECB announcement while economic data was better than feared overnight.
German Manufacturers’ Orders rose 0.3% vs. (E) -0.1% in April while Eurozone GDP was in –line at 0.4% in Q1. Importantly, neither report was inflationary which is allowing the global rally, driven by a notable dovish shift in sentiment, alive today.
Looking into today’s session, Europe will be in focus early as the ECB Announcement is due out at 7:45 a.m. ET and Draghi’s press conference is scheduled for 8:30 a.m. ET. As long as there are no hawkish surprises out of the ECB, money flows are likely to remain “risk-on” as the U.S. session gets underway.
Domestic focus today will be on the few data points: International Trade (E: -$50.8B), Jobless Claims (E: 215K), and Productivity and Costs (E: 3.4%, -0.8%) as well as Fed speakers: Kaplan (8:40 a.m. ET) and Williams (1:00 p.m. ET).
Again, as long as there are no hawkish surprises today, the path of least resistance is still higher for stocks, although the market has gone from deeply oversold, to near term overbought in a hurry so some consolidation or a modest pullback should not come as a surprise ahead of tomorrow’s jobs report.