Companies like Chipotle and United Airlines said the increase in COVID cases was not…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
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).
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:
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.
What’s in Today’s Report:
Stock futures are little changed as Treasuries recover some of yesterday’s losses ahead of more U.S. inflation data and Congressional testimony from Fed Chair Powell today.
Economically, U.K. CPI was above estimates in June but PPI was unexpectedly soft while Eurozone Industrial Production also disappointed, but none of the data from overnight seems to be having a material impact on markets this morning.
Today, there is one more inflation report in the U.S., PPI (E: 0.6% m/m, 6.8% y/y) at 8:30 a.m. ET and then focus will turn to Fed speak with Chair Powell’s semiannual testimony before Congress beginning at 12:00 p.m. ET and Kashkari also speaking at 1:30 p.m. ET.
The start of Q2 earnings season will also remain in focus with notable reports coming from: WFC ($0.97), BAC ($0.78), C ($1.99), DAL (-$1.37), BLK ($9.24), and PNC ($4.22).
Futures are slightly lower following a very quiet weekend of news as markets wait for…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Stock futures are little changed amid a stable bond market this morning following good economic data while focus shifts to the unofficial start of earnings season and the latest consumer inflation report in the U.S.
Economically, the NFIB Small Business Optimism Index came in at 102.5 vs. (E) 99.2 for the month of June.
Today, earnings will come into focus as the big banks kick off the Q2 reporting season. Notable companies releasing results today include: JPM ($3.05), GS ($9.57), PEP ($1.52), and FAST ($0.41).
The latest U.S. inflation data will also be released ahead of the opening bell: CPI (0.5% m/m, 5.0% y/y) while there are several Fed officials scheduled to speak in the afternoon: Bostic (12:00 p.m. & 2:30 p.m. ET), Kashkari (12:45 p.m. ET), Rosengren (2:50 p.m. ET).
Bottom line, the number of influences on equities clearly picks up today and for stocks to hold the latest record highs we will need to see 1) earnings at least meet estimates, 2) CPI data not run “hot,” and 3) Fed chatter remain accommodative and importantly not take a hawkish turn.
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What’s in Today’s Report:
Futures are slightly lower following a very quiet weekend of news as markets wait for the start of earnings this week along with updated inflation data.
G-20 finance ministers agreed to move forward with a plan for a global minimum tax, but this remains a very, very long way from actual implementation.
China’s reserve requirement ratio cut remained top of the news but it’s unlikely to provide major stimulus and as such it’s not a material bullish catalyst for global stocks.
Today there are no economic reports and just two Fed speakers: Williams (9:30 a.m. ET) and Kashkari (12:00 p.m. ET). As was the case last week, we expect yields to dictate trading in stocks, so if Treasury yields continue to bounce, stocks should extend Friday’s rally.
What’s in Today’s Report:
Futures are drifting modestly higher following a generally quiet night of news.
Economic data was solid as European Commission Economic Sentiment beat estimates (114.5 vs. (E) 112.1) while the Japanese unemployment rate was in-line with expectations. But, neither number is moving markets.
Earnings overnight were very strong (especially in the retailers like COST) but questions remain about the sustainability of the results so they aren’t causing a big rally.
Today focus will be on the Core PCE Price Index (E: 0.7% m/m, 3.0% y/y). The market expects and has priced in a strong number, so something slightly above estimates should not cause a hawkish reaction (yields higher/stocks lower). But, if we see the Core PCE Price Index print close to 4% yoy, that would likely be a headwind on stocks (and push the 10 year yield towards 1.70%).