If support holds, which it likely will as long as the news flow regarding COVID does not continue to…Tom Essaye of the Sevens Report has told MarketWatch. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower following underwhelming Chinese economic data and on a mild decrease in geo-political stability.
Chinese Retail Sales, Industrial Production, and Fixed Asset Investment all rose, but missed expectations and that’s weighing modestly on global stocks.
Geo-politically, the Taliban taking control of Afghanistan doesn’t have any direct market implications, but it is a political negative for Biden which could hurt the chances any infrastructure bill is passed.
Today the only notable economic report is the Empire Manufacturing Index (E: 30.0), and that’s more important than usual as markets will want to see if the Delta variant slowed economic activity in August. If this number badly misses expectations, it will likely be a headwind on stocks today.
What’s in Today’s Report:
Futures are again little changed following another generally quiet night of news.
Economic data was minimal as the only notable report was EU exports, which missed expectations falling –0.7% vs. (E) 0.6%, but that’s not moving markets.
On the COVID front, there were mixed headlines. ABNB said it has seen a small slowdown in bookings because of Delta (a negative), but COVID cases have potentially peaked in China (a positive). In sum, the headlines were mixed enough that they aren’t moving markets, but we will continue to watch for more evidence that the Delta variant is altering consumer behavior.
Today the key report will be the inflation expectations in Consumer Sentiment (E: 81.4) but as long as that doesn’t spike higher, it shouldn’t move markets. Instead, COVID headlines will continue to move markets and if there is more evidence the Delta variant is impacting travel/leisure, that will be a headwind on stocks.
The oil market is likely to remain rangebound here as the physical market is poised to…said Tom Essaye, editor of the Sevens Report. Click here to read the full article.
Rising COVID cases will only hurt the market if they result in a change in…Tom Essaye, a former Merrill Lynch trader who writes the “Sevens Report” newsletter, wrote in a note. Click here to read the full article.
What’s in Today’s Report:
Futures are slightly lower following a mostly quiet weekend of news as there were no major changes to the COVID outlook or the economic recovery.
Economic data was solid as German and Chinese exports for July both beat estimates.
Chinese CPI rose 1% vs. (E) 0.8% and that may reduce the amount of stimulus officials unleash on the economy (so potentially negative for global growth).
Today focus will be on JOLTS (E: 9825M) and on Fed commentary following the jobs report (Bostic at 10:10 a.m. ET and Barkin at 11:20 a.m. ET). But, unless JOLTS are a major surprise or Fed officials are shockingly hawkish, these events shouldn’t move markets. As such, the tenor of COVID headlines (and whether we are seeing behavior changes) will continue to drive markets in the near term.
What’s in Today’s Report:
Futures are little changed ahead of this morning’s jobs report.
Economic data underwhelmed overnight with Japanese Household Spending falling –3.2% while German Industrial Production missed estimates (-1.3% vs. (E) 0.5%).
On COVID, headlines remain net negative as cases continue to rise and analysts look for any signs of a loss of economic momentum (so far there’s nothing concrete).
Today the focus is on the jobs report and expectations are as follows: Job Adds: 900K, UE Rate: 5.7% and Wages: 0.3% m/m and 3.8% y/y. Again, the biggest risk to markets is for a “Too Hot” jobs number that shifts the tapering timeline, and if that occurs we should brace for volatility.
What’s in Today’s Report:
Futures are slightly higher following a quiet night as markets tentatively bounce back from Wednesday’s losses.
Economic data was mixed overnight as German Manufacturers’ Orders beat estimates (4.1% vs. (E) 1.5%) while the UK Construction PMI missed estimates (58.7 vs. (E) 63.8).
On COVID, Los Angeles could follow NYC in requiring proof of vaccination for indoor activities (if this becomes widespread policy in large cities it’ll be an economic headwind.)
Today we have a Bank of England meeting (No Change to Rates Expected), Jobless Claims (E: 381K), and one Fed speaker, Waller at 10:00 a.m. ET (who could be hawkish again, remember he called for tapering to start as early as September).
But, unless there’s a major surprise from the BOE or jobless claims, then COVID headlines will drive markets, and any signs of restrictions or behavior changes in people will cause volatility (and a decline in stocks).
What’s in Today’s Report:
Futures are moderately higher following solid economic data and positive lockdown comments from Dr. Fauchi.
Global July manufacturing PMIs were generally solid, as the EU PMI beat estimates (62.9 vs. (E) 62.6) while the UK PMI was in line (60.4). The Chinese PMI missed estimates (50.4 vs. (E) 50.8) but remained above 50. Overall, the PMIs implied the global economic recovery was on going.
Dr. Fauchi stated over the weekend that he did not think the U.S. would reinstitute lockdowns despite rising COVID cases (which is a positive for the economy).
Today the key economic report will be the ISM Manufacturing PMI (E: 60.8) and markets will be looking for a “Goldilocks” number – one that meets or exceeds expectations but is not so strong that it makes the Fed less dovish. COVID headlines will also potentially move markets but unless there are signs of people changing their behavior (TSA Throughput, consumer surveys) then COVID headlines shouldn’t move markets.
What’s in Today’s Report:
Futures are moderately lower on disappointing earnings and more negative COVID commentary.
AMZN earnings disappointed investors and the stock was down –6% after hours and that’s weighing on futures.
On COVID, a CDC internal memo called the Delta variant potentially as contagious as Chickenpox, although markets remain generally optimistic given positive corporate commentary on economic activity.
Today the key number will be the Core PCE Price Index (E: 0.5%, 3.7%) which is the Fed’s preferred measure of inflation. If that number runs well above expectations (so above 4% yoy) expect a “hawkish” reaction from markets (yields up, stocks flat to down). Also today we get Consumer Sentiment (E: 80.8) and have one Fed speaker, Bullard at 9:00 a.m. ET, but they shouldn’t move markets.
On the earnings front, much of the discussion this morning is on AMZN but there are some other notable reports out this morning including: PG ($1.08), CAT ($2.38), XOM ($1.02), ABBV ($3.11), CVX ($1.54).