Posts

Is the NOB Spread Signaling a “Run Hot” Economy?

/in , /by

What’s in Today’s Report:

  • Is the NOB Spread Signaling a “Run Hot” Economy?

Futures are in the red but off their overnight lows as traders digest President Trump’s latest efforts to “fire” Fed Governor Cook, rekindling “Fed independence” concerns.

Economically, French Consumer Confidence fell 2 points to 87 vs. (E) 89 in August while Prime Minister Bayrou has called for a confidence vote on September 8, surrounding budget concerns which introduces a renewed sense of market uncertainty in Europe.

Looking into today’s session there are multiple noteworthy economic reports to watch today including Durable Goods (E: -4.0%), Case-Shiller Home Price Index (E: 2.6%), FHFA House Price Index (E: 0.0%), and likely most importantly, Consumer Confidence (E: 96.4).

There is one Fed official scheduled to speak: Barkin (8:30 a.m. ET) as well as a 2-Yr Treasury Note auction at 1:00 p.m. ET, both of which could impact Treasuries and impact equity market trading today.

Finally, a handful of late season earnings releases are due out including: BMO ($2.12), BNS ($1.28), and OKTA ($0.33), but the main earnings catalyst this week will be NVDA’s release later in the week.

 

Is There Any Value Left in Tech?

/in , /by

What’s in Today’s Report:

  • Is There Any Value Left in Tech?
  • Jackson Hole Powell Speech Preview
  • EIA and Oil Market Analysis

Futures are slightly lower despite generally solid economic data overnight.

EU and UK August flash PMIs were mostly solid, with Composite PMIs rising for both regions and staying above 50.

Today is a busy day of economic data and the key reports, in order of importance, are:   Flash Manufacturing PMI (E: 49.7), Flash Services PMI (E: 53.0), Jobless Claims (E: 224K), Philly Fed (E: 8.0), Existing Home Sales (E: 3.90 million) and Leading Indicators (E: -0.1%).  Especially with the flash PMIs, solid data that pushes back on any slowdown narrative will be welcomed by stocks.  There is also one Fed speaker today, Bostic at 7:30 a.m. ET, but he shouldn’t move markets.

On earnings, notable retailer results continue today with WMT ($0.73), while there are some other notable reports as well: BILI ($0.08), ZM ($0.77), INTU ($1.30), WDAY ($0.80), ROST ($1.52).

 

Market Concentration Risks Warrant Attention

/in , /by

What’s in Today’s Report:

  • Market Concentration Risks Warrant Attention
  • Housing Starts Data Takeaways

Futures are modestly lower but off session lows as the recent tech-led stock market pullback is being digested as the Fed’s Jackson Hole Economic Policy Symposium comes into focus.

Economically, Eurozone HICP (their CPI equivalent) met estimates at 2.0% on the headline and 2.3% on the core figure which is easing recently elevated concerns about a broad-based resurgence in global inflation pressures, subsequently helping equities bounce off the lows.

There are no economic reports today, however the July FOMC meeting minutes will be released at 2:00 p.m. ET and investors will be scouring the details for any new insights on Fed policy plans for H2’25.

Additionally, there are two Fed officials scheduled to speak: Waller (11:00 a.m. ET) and Bostic (3:00 p.m. ET) as well as a 20-Yr Treasury Bond auction at 1:00 p.m. ET that could shed light on investor growth/inflation expectations (and therefore could most stocks).

Finally, retailers continue to dominate earnings news this week with multiple notable major corporations reporting quarterly results today including: TGT ($2.09), EL ($0.08), TJX ($1.01), LOW ($4.23), BIDU ($1.32), and COTY ($0.01). Evidence of ongoing consumer resilience would be a positive for risk assets and likely help stocks stabilize from the early week pullback today.

 

Why Today’s CPI Is So Important (Hint: 50, 25, 0)

/in , /by

What’s in Today’s Report:

  • Why Today’s CPI Is So Important (Hint: 50, 25, 0)
  • Gold Chart: Fragile Record Highs

Futures are flat as traders look ahead to today’s all-important CPI report.

Economically, the U.K.’s Unemployment Rate held steady at 4.7%, as expected, while the German ZEW Survey missed estimates, but the July NFIB Small Business Optimism Index rose to 100.3 vs. (E) 98.9 from 98.6 in June.

Today, market focus will be almost exclusively on inflation data before the bell with CPI (E: 0.2% m/m, 2.8% y/y) and Core CPI (E: 0.3% m/m, 3.0% y/y) due out at 8:30 a.m. ET.

After the open, there are two Fed officials scheduled to speak: Barkin (10:00 a.m. ET) and Schmid (10:30 a.m. ET), and any comments or insights they may offer in reaction to the CPI data could move markets.

Finally, earnings season continues to wind down but there are a handful of companies due to report quarterly results today which could move markets, including: CAH ($2.03), SE ($0.72), RGTI ($-0.05), HRB ($2.81), CRCL ($-1.29), and ETOR ($0.49).

 

MMT Chart: A “Relatively” Different Look at Stocks

/in , /by

What’s in Today’s Report:

  • August MMT Chart Update: A “Relatively” Different Look at Stocks
  • ISM Services Index – A Fresh “Whiff” of Stagflation
  • Stagflation Risks Set Gold Up for Run to Record Highs

Futures are tracking global markets higher this morning as investors shrug off both the ISM Services Index from yesterday, which carried a whiff of stagflation, and soft earnings from semiconductor giants AMD (-7%) and SMCI (-17%) after the close yesterday.

Economically, EU Retail Sales rose 3.1% vs. (E) 2.6% which is serving to tamp down worries about the health of the global economy.

Looking ahead to today’s session, there are no noteworthy economic reports due to be released.

However, the Treasury will hold a 4-Month Bill auction at 11:30 a.m. ET and a 10-Yr Note auction at 1:00 p.m. ET and investors will look for the recent trend of healthy demand metrics to continue, despite the sharp drop in yields since Friday’s dismal jobs report.

Additionally, there are a few Fed officials scheduled to speak who could shed light on the prospects of a September rate cut (which is increasingly expected) including Cook & Collins (2:00 p.m. ET) and Daly (3:10 p.m. ET).

Finally, earnings season continues with MCD ($3.15), UBER ($0.62), SHOP ($0.20), DIS ($1.47), NRG ($1.54), ABNB ($0.93), and ET ($0.32) all reporting quarterly results today.

For now, investors are overlooking the soft semiconductor earnings from late yesterday, however, any Q2 results that challenge the idea that the consumer remains resilient and healthy in 2025, could add to recession worries and pressure stocks again today.

 

Market Multiple Table: August Update

/in , /by

What’s in Today’s Report:

  • August Market Multiple Table: How Much Deterioration Has Occurred?

U.S. futures are higher thanks to good economic data overseas and solid tech earnings with PLTR up 6% premarket after topping estimates and raising guidance.

Economically, China’s Services PMI unexpectedly rose from 50.6 to 52.6 vs. (E) 50.4, helping ease global growth concerns which surged following Friday’s downbeat U.S. jobs report.

Today, focus will be on economic data early with International Trade in Goods (E: $-61.5B) and the ISM Services PMI (E: 51.5) due to be released.

From there, focus will turn to the bond market as the Treasury will hold 4-Week & 52-Week Bill auctions at 11:30 a.m. ET and a 3-Yr Note auction at 1:00 p.m. ET, all of which could shed light on investors’ outlook for Fed policy rates in the near-term.

Finally, earnings season continues with PFE ($0.58), CAT ($4.88), BP ($0.68), AMD ($0.28), AMGN ($5.26), SMCI ($0.35), and AFL ($1.71). Near all-time highs, this market will want to see continued strength in both Q2 results, as well as forward guidance in order for the rebound from last week’s pullback to gain momentum.

 

Credit Spreads Are More Elevated Than You Think

/in , /by

What’s in Today’s Report:

  • Credit Spreads: More Elevated Than You Think
  • Case-Shiller Home Price Index Points to Cooling Inflation
  • JOLTS Decline But Top Estimates

Futures are modestly higher this morning as traders digest yesterday’s pullback ahead of today’s Fed decision.

Economically, Eurozone GDP rose +1.4% y/y vs. (E) +1.2% which is supporting the tentative risk-on price action this morning.

Today, focus will be on economic data early with the ADP Employment Report (E: 75K), Advanced Q2 GDP (E: 2.5%),  and Pending Home Sales (E: 0.2%) all due to be released.

Attention will then turn to the Fed meeting with the FOMC Announcement at 2:00 p.m. ET and Fed Chair Powell’s Press Conference at 2:30 p.m. ET with traders most focused on the prospects of a September rate cut.

Finally, earnings season continues as well and the following companies results have the potential to move markets, particularly the Mag-7 names reporting today: KHC ($0.64), HUM ($6.32), META ($5.83), MSFT ($3.35), CVNA ($1.10), QCOM ($2.72), ADP ($2.22), HOOD ($0.31).

 

FOMC Preview: Wildcard to Watch

/in , /by

What’s in Today’s Report:

  • FOMC Preview: What’s Expected, Hawkish Scenario, Dovish Scenario
  • Fed Meeting Wildcard to Watch: Dovish Dissents

U.S. equity futures are tracking European shares higher this morning amid continued optimism surrounding the U.S.-EU trade deal and resilient earnings ahead of the Fed decision.

There were no noteworthy economic reports overnight which will leave focus on earnings and U.S. economic data today as the July Fed meeting gets underway in Washington.

Today’s economic calendar is a fairly busy one with several potential market-moving reports due to be released including: Consumer Confidence (E: 95.8), JOLTS (E: 7.4 million), Case-Shiller Home Price Index (E: 2.9%), and International Trade in Goods (E: $-99.0B).

Looking at earnings, the Q2 reporting season continues with notable companies releasing results today including: UNH ($4.84), SOFI ($0.06), BA ($-1.54), PG ($1.43), V ($2.86), MRK ($2.01), SBUX ($0.64).

Bottom line, investors will continue to look for resilient, yet not “too hot” economic data trends and upbeat earnings and guidance in order for stocks to hold yesterday’s record highs, however a familiar sense of “Fed Paralysis” is likely to grip markets ahead of tomorrow’s critical Fed decision.

 

Stablecoin Primer: Why Last Week’s Legislation Was Important

/in , /by

What’s in Today’s Report:

  • Stablecoin Primer:  Why Last Week’s Legislation Was Important

Futures are little changed following a night of mixed earnings followed by more mixed economic data.

The EU July flash PMI slightly beat estimates (51.0 vs. (E) 50.9) while the UK reading missed (51.0 vs. (E) 51.7) but both numbers were above 50 and signaling expansion.

On earnings, GOOGL posted solid numbers (up 3% pre-market) while TSLA underwhelmed (down 6% pre-market).

Today focus will turn towards economic data and there are two notable reports to watch: Jobless Claims (E: 225K) and the Flash Manufacturing PMI (E: 52.7).  If both reports are solid, look for the rally to continue driven by cyclical sectors, as investors embrace a potentially re-accelerating economy.  We also get New Home Sales (E: 650K), although that shouldn’t move markets.

On earnings, the season remains “fine” so far.  Key reports we’re watching today include: INTC ($0.14), AAL ($0.79) and BX ($1.10).

 

Why Markets Continue to Ignore Macro Risks

/in , /by

What’s in Today’s Report:

  • Why Markets Continue to Ignore Macro Risks
  • Weekly Market Preview:  Focus Turns to Earnings (Including Major Tech Names)
  • Weekly Economic Cheat Sheet:  Flash PMIs Thursday is the Big Report This Week

Futures are modestly higher mostly on momentum following a generally quiet weekend of news.

There were no notable trade headlines over the weekend and markets are still awaiting any progress on trade deals with the EU, India and Japan.

Economically, there were no notable international reports overnight.

Today there is only one economic report, Leading Indicators (E: -0.2%), and it shouldn’t move markets.

Instead, focus today and this week will be on earnings and specifically the commentary from CEOs on the consumer and economy.  Some reports we’re watching today include: NXPI ($2.29), VZ ($1.18), DPZ ($3.93), CLF ($-0.67), CCK ($1.86).