Tom Essaye Quoted in Barron’s on July 30, 2021
Amazon Sinks, Chevron Pops, and the Nasdaq Is Down
Futures are moderately lower on disappointing earnings…wrote Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
Tag Archive for: earnings
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Watch TSA Throughput (Again)
What’s in Today’s Report:
- Watching TSA Throughput, Again
Stock futures are rebounding following yesterday’s losses as positive earnings help offset renewed volatility in Chinese markets and mixed Fed speak to start the week.
Volatility in Chinese equities spiked again overnight as regulators reportedly took aim at gaming companies, but the state-owned news article that initiated the largely tech-focused selling was removed and Chinese indices ended well off the lows.
Economically, EU PPI was the latest “hot” inflation print as it surprisingly rose 0.1% to 1.4% vs. (E) 0.6% in June, but for now, investors are largely shrugging off the release.
Today, there are two economic reports: Motor Vehicle Sales (E: 15.7) and Factory Orders (E: 0.8%) as well as one Fed official scheduled to speak: Bowman (2:00 p.m. ET), however, they should not materially move markets with the July jobs data looming.
Solid earnings have been a major supporter of equity markets in recent weeks and the Q2 reporting season remains in full swing with BABA ($2.24), LLY ($1.89), CLX ($1.29), BP ($0.61), and COP ($1.15) releasing results before the bell, and notables LYFT (-$0.24) and AMGN ($4.23) reporting after the closing bell.
Bottom line, the sharp drop in bond yields played a big role in yesterday’s stock market pullback, so if Treasuries stabilize today, stocks should be able to regain some ground however there are several risks that could see the major indexes make new lows for the week including hawkish Fed chatter and negative Delta-variant developments.
Economic Breaker Panel (Some Loss of Momentum)
What’s in Today’s Report:
- Economic Breaker Panel (Some Loss of Momentum)
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).
Tom Essaye Quoted in Barron’s on July 21, 2021
Stocks Close Up. Investors Focus on Earnings and Covid.
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.
Tom Essaye Quoted in Barron’s on July 22, 2021
CSX Rises, Las Vegas Sands Falls, and Stocks Are Wavering
Futures are marginally higher following another night of…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
ECB Decision Takeaways (Not Dovish Enough, Again)
What’s in Today’s Report:
- ECB Decision Takeaways (No Dovish Enough, Again)
- Updated Oil Outlook
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).
Why Did Stocks Rally?
What’s in Today’s Report:
- Why Did Stocks Rally?
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).
Four Pillars of the Rally Updated (Still Intact)
What’s in Today’s Report:
- Four Pillars of the Rally Updated (Still Intact)
- Weekly Market Preview: Does Delta Cause a Pullback? Can Earnings Impress Investors?
- Weekly Economic Cheatsheet: Flash PMIs Friday are the Key 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.
CPI Takeaways
What’s in Today’s Report:
- CPI Takeaways
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).
Tom Essaye Quoted in Barron’s on July 12, 2021
Virgin Galactic Soars, Rocket Cos. Drops, and Stocks Are Mostly Lower
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.