“If earnings news is not encouraging today, and yields continue to move higher over the course of the session, the selling pressure on equities is likely to continue and liable to accelerate,” wrote Tom Essaye, founder of the Sevens Report. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately weaker following a disappointing night of earnings.
TSLA, NOK, FFIV and TSMC all missed earnings and provided cautious commentary or guidance, and that’s increasing concerns about an economic slowdown.
Today there are numerous potential catalysts including important economic reports, lots of Fed speak and more earnings reports.
Starting with the data, the key report today is Philly Fed (E: -19.4) and markets will want to see if it confirms the rebound we saw in Empire (if it does, expect some stock weakness as Fed expectations become slightly more hawkish). We also get Jobless Claims (E: 242K) and any move closer to 300k will be welcomed as it signals a slightly more normal labor market.
Turning to the Fed, there are multiple speakers today including Waller (12:00 p.m. ET), Mester (12:20 p.m. ET), Logan (3:00 p.m. ET) and Bostic (5:00 p.m. ET) and it will be notable to see if they all push back on the rate cut expectations in the markets.
Finally, on earnings, results lately have been underwhelming so these reports are becoming more important. Earnings we’re watching today include: T ($0.58), TSM ($1.21), AXP ($2.63), UNP ($2.57), PPG ($1.55), CSX ($0.43), STX ($0.18).
What’s in Today’s Report:
Futures are little changed following a quiet weekend of news as investors await key regional bank earnings this week.
The only notable economic report this morning was Italian CPI, which fell –0.4% vs. (E) -0.3% and further implied that global disinflation has restarted (which is a positive).
Today we get the first look at April economic activity via the Empire Manufacturing Survey (E: -18.3) and markets will want to see stability (so not a continued steep drop). We also get the latest look at housing via the Housing Market Index (E: 45).
Additionally, regional bank earnings start and their commentary on deposits and “Held to Maturity” securities will be especially important. Some reports we’re watching today include: SCHW ($0.90), GNTY ($0.69), MTB ($3.98), JBHT ($2.05).
What’s in Today’s Report:
U.S. stock futures are tracking global shares higher this morning as investors cheer better than expected economic data out of China.
Economically, China’s Manufacturing PMI jumped to 51.6 vs. (E) 49.9 in February, up from 49.2 in January, indicating the recovery process is gaining momentum. The Eurozone Manufacturing PMI, meanwhile, met estimates at 48.5.
Today, investor focus will be on economic data early beginning in Europe with the German CPI release at 8:00 a.m. ET (E: 8.7%). So far this week, European yields have led global yields higher on hot inflation data and if the German print is above estimates, expect that trend to continue and stocks to remain under pressure.
In the U.S. we will get the February ISM Manufacturing Index (E: 48.0) as well as the lesser followed Construction Spending report (E: 0.2%). Investors will want to see improving, but not overly strong growth metrics and fading price pressures to see some of the recent hawkish money flows ease.
Finally, there is one Fed speaker today: Kashkari (E: 9:00 a.m. ET), and as a voting member of the FOMC, his comments will be closely watched for any new hints at the Fed’s policy plans.
What’s in Today’s Report:
Stocks futures are trading with modest gains this morning while Treasury yields are tracking European bond yields higher following stubbornly high inflation data overnight.
Economically, both Spanish and French CPI headlines were hotter than expected, above 6%, which saw European rates markets price in a 4% terminal ECB rate for the first time. Government bond yields across the Eurozone notably rose to multi-year highs.
Looking into today’s session, there are several economic reports to watch including: International Trade (E: -$91.0B), Case-Shiller Home Price Index (-0.5%), FHFA House Price Index (E: -0.3%), and Consumer Confidence (E: 108.5).
Traders will be looking for less signs of stagflation in the data as elevated inflation figures and weakening growth metrics were a headwind for equities last week.
Finally, the Chicago Fed’s Goolsbee (who just succeeded Evans) has his first speaking engagement since taking over the role at 2:30 p.m. ET, and as a voting member of the FOMC, his comments will be closely watched for any new clues about Fed policy plans in the months ahead. A notably hawkish tone, could easily cause another bout of volatility in risk assets this afternoon.
What’s in Today’s Report:
Stock futures are modestly higher thanks to good economic data overnight as traders await today’s U.S. CPI report and more Fed speak.
Economically, the U.K.’s Unemployment Rate held steady below 4% but wage growth favorably slowed to 5.9% in January from 6.5% in December.
Meanwhile the NFIB Small Business Optimistic Index in the U.S. met estimates at 90.3 which saw S&P 500 futures hit new pre-market highs at the top of the 6:00 a.m. hour ET.
Today, focus will be on economic data early with CPI (E: 0.5% m/m, 6.2% y/y) and Core CPI (E: 0.3% m/m, 5.5% y/y) due out before the opening bell. Cooling inflation pressures have largely been priced in recently so a low print could see stocks add to YTD gains, but the risk is for a hot print to spark a significant wave of selling amid further hawkish shifting money flows across asset classes.
Moving through the day, there are three Fed speakers to watch: Logan (11:00 a.m. ET), Harker (1:00 p.m. ET), and Williams (2:05 p.m. ET) and they will all likely echo the hawkish tone coming from other Fed officials recently but their comments should not have a major impact on markets.
Earnings season is winding down but a few notable companies reporting today include: KO ($0.45), MAR ($1.84), ABNB ($0.27).
Markets should be poised for a higher open, as they want to see claims begin to rise over the coming weeks, otherwise it’ll imply the labor market remains much, much too tight, Tom Essaye, founder of Sevens Report Research, said. Click here to read the full article.
Overall, “an improving outlook for the health of the U.S. economy in the wake of the January jobs report, and ongoing optimism about the positive demand impact of China’s rapid reopening process are offering support to global oil markets right now,” said the Sevens Report’s Richey. Click here to read the full article.
Tom Essaye, founder and president of Sevens Report Research and Andrew McCreath, founder at Forge First Asset Management, join BNN Bloomberg to discuss the latest large-cap earnings reports. Essaye says that Uber’s strength this season is a signal that life is getting back to normal and discusses how diversification will be imperative for companies to succeed amid the growth slowdown. Click here to watch the full interview.
