Posts

Even after the revisions, the data was really mostly in line.

/in , /by

Even after the revisions, the data was really mostly in line: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

The Market Is in a Trance. Wednesday’s Inflation Data Could Break It.

But Sevens Report Research’s Tom Essaye told Barron’s in a phone interview that even after the revisions, the data was really mostly in line.

“The markets could be entering an extension of the sweet spot that they were in earlier in the year,” Essaye says. “If you’re looking out, there are definitely some things you want to pay attention to, because some of this data is starting to point in a not-great direction. But it’s not necessarily a reason to sell now.”

“We were in the bullish trance, and now Powell has kind of put us back into it by saying, ‘Well, no, we’re not going to hike rates. Probably going to cut rates once or twice’ or whatever,” Essaye says. “That kind of got us back into it. So it’s going to take a hot data point.”

Also, click here to view the full Barron’s article published on May 14th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to RallyIf you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Advisor Considerations of the “T+1” Settlement Change

/in , /by

Advisor Considerations of the “T+1” Settlement Change: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Practice Management Update: Examining the Upcoming Move to T+1 Settlement
  • Long-Term S&P 500 Chart: Greatest Volatility Risk Since January 2022

Futures are flat this morning as economic data was mixed in Europe and global traders await NVDA earnings (tomorrow) to gauge the outlook for AI industry growth.

In Europe, German PPI fell -3.3% vs. (E) -3.1% underscoring that disinflation trends remain underway in the EU while the UK’s CBI Industrial Trends Order Balance dropped -33% vs. (E) -20% adding to global factory sector worries.

Looking into today’s session, there are no economic reports to watch but a handful of Fed speakers on the calendar this morning: Barkin (9:00 a.m. ET), Waller (9:00 a.m. ET), Williams (9:05 a.m. ET), Bostic (9:10 a.m. ET) and Barr (11:45 a.m. ET).

At this point, the higher-for-longer mantra has been absorbed by markets and it would take renewed talk of rate hikes to meaningfully move markets, especially as traders settle in and await tomorrow’s post-bell earnings release from NVDA which is widely viewed as the most important catalyst of this week.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

How Long Can Goldilocks Last?

/in , /by

How Long Can Goldilocks Last? Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • How Long Can Goldilocks Last?
  • Weekly Market Preview:  More Updates on Growth and AI Enthusiasm (NVDA Earnings on Wednesday)
  • Weekly Economic Cheat Sheet:  Will the First Big Report of May Confirm Slowing Growth?

Futures are little changed following a generally quiet weekend of news and ahead of another important week of potential market catalysts.

Geopolitics was in focus this weekend as Iranian President Raisi was killed in a helicopter crash, although it appears an accident and oil isn’t rallying on the news.

There was no notable economic data overnight.

Today there are no economic reports but there are multiple Fed speakers including: Bostic (7:30 & 8:45 a.m. ET), Barr & Waller (9:00 a.m. ET), Jefferson (10:30 a.m. ET), Mester (2:00 p.m. ET) and Bostic again (7:00 p.m. ET).  However, for all the commentary, unless multiple Fed officials start openly discussing rate hikes (which is extremely unlikely) their commentary shouldn’t meaningfully move markets.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Still A Soft Landing, But Growth Is Slowing

/in , /by

Still A Soft Landing, But Growth Is Slowing: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Hard Landing/Soft Landing Scoreboard:  Still A Soft Landing, But Growth Is Slowing

Futures are little changed as markets again digested the post CPI rally amidst more in-line inflation data and additional Chinese economic stimulus.

Core EU HICP (their CPI) met expectations, rising 0.7% m/m and 2.7% y/y, and kept a June rate cut on track.

In China, the government announced a sweeping program to support the property industry, potentially adding more critical stimulus to the Chinese economy.

Today focus will be on Leading Indicators (E: -0.3%) and two Fed speakers, Waller (10:15 a.m. ET) and Daly (12:15 p.m. ET), but barring any major surprises, they shouldn’t move markets and further digestion of the new highs is to be expected.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Short vs. Long Term Market Outlook (Is Falling Inflation & Slowing Growth Good for Stocks?)

/in , /by

Short vs. Long Term Market Outlook: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Short vs. Long Term Market Outlook (Is Falling Inflation & Slowing Growth Good for Stocks?)
  • EIA Update and Oil Market Analysis

Futures are little changed as market digest Wednesday’s new high amidst more dovish global data.

Japanese GDP (-0.5% vs. (E) -0.4%), Aussie Unemployment (4.1% vs. (E) 3.9%) and Italian HICP (their CPI, 0.9% vs. (E) 1.0% y/y) all pointed towards falling inflation and slowing global growth, which investors welcome (for now).

Today is a busy day full of data and Fed speak.  Broadly speaking, if the data/Fed speak is dovish and Treasury yields drop, it’ll extend the rally.

Notable economic data today includes (in order of importance):  Jobless Claims (E: 219K), Philly Fed (E: 7.8), Industrial Production (E: 0.1%) and Housing Starts (E: 1.435MM).

On the Fed, there are numerous speakers including:  Barr (10:00 a.m. ET), Barkin (10:00 a.m. ET), Harker (10:30 a.m. ET), Mester (12:00 p.m. ET), Bostic (3:50 p.m. ET).  But, unless they all start talking about rate hikes (very unlikely), their commentary shouldn’t move markets.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Key Levels to Watch: S&P 500, 10Y, Gold, VIX

/in , /by

Key Levels to Watch: S&P 500, 10Y, Gold, VIX: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • CPI Technical Preview: S&P 500, 10Y, Gold, VIX
  • Trading Color – The “Chase” Higher Continued Yesterday
  • PPI Takeaways: Downside Revisions Spark Dovish Money Flows

Futures are flat while European stocks are modestly higher thanks to market-friendly economic data overnight ahead of today’s U.S. CPI report.

GME and AMC are both notably up another 10%+ in pre-market trading suggesting the meme-stock frenzy is poised to continued today.

Economically, French CPI met estimates at 2.2% y/y while Eurozone Industrial Production was up 0.6% vs. (E) -0.5% helping to ease lingering worries about the threat of global stagflation.

Today, focus will be acutely on economic data in the premarket with CPI (E: 0.3% m/m, 3.4% y/y) and Core CPI (E: 0.3% m/m, 3.6% y/y) the most important release to watch. Downside revisions to March like we saw in yesterday’s PPI report and a goldilocks headline should see stocks extend gains and test or break through current records.

However, in order for the equity rally to continue it is important that Retail Sales (E: 0.4%), the Empire State Manufacturing Index (E: -10.0), and the Housing Market Index (E: 51.0) don’t offer and negative surprises as there is a tentative and complacent feel to the current test of the all-time-highs.

After the economic data is digested, there are two Fed officials scheduled to speak today: Kashkari (12:00 p.m. ET) and Bowman (3:20 p.m. ET). Investors have become comfortable with the higher-for-longer tone recently, but any mention of hikes could pressure markets here.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

The key parts of the release will be one and five-year inflation expectations

/in , /by

The key parts of the release will be one and five-year inflation expectations: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

Dow Opens Higher, Extending Winning Streak

Aside from the Fed speakers, traders will get an update on consumer sentiment from the University of Michigan. Sevens Report Research’s Tom Essaye writes that the key parts of the release will be one-year inflation expectations and five-year inflation expectations.

“If both of those numbers are higher than expected, it’ll be another negative signal on inflation and don’t be surprised if Treasury yields rise in response to them and stocks give back these early gains,” Essaye writes.

Also, click here to view the full Barron’s article published on May 10th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to RallyIf you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Are Stagflation Risks Real?

/in , /by

Are Stagflation Risks Real? Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Are Stagflation Risks Real?
  • Weekly Market Preview:  If Treasury Yields Rebound, Will That Hit Stocks?
  • Weekly Economic Cheat Sheet:  CPI on Wednesday, Important Growth Data Throughout the Week

Futures are slightly higher following a very quiet weekend of news as investors look ahead to a potentially very important week that includes Wednesday’s CPI report.

China announced plans to sell $140 billion in long term bonds to fund more economic stimulus, which will help combat recession fears in that economy.

There was no notable economic data out over the weekend.

Today focus will be on the New York Fed One Year Inflation Expectations (3.0%).  If they run hot like we saw in Friday’s University of Michigan Inflation Expectations, Treasury yields should rise and pressure stocks.  Outside of that data, we also have two Fed speakers, Jefferson & Mester (9:00 a.m. ET), but they shouldn’t move markets unless they talk about rate hikes.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Things aren’t as bad as people were afraid of

/in , /by

Things aren’t as bad as people were afraid of: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

S&P 500 Holds Above Its 50-Day Moving Average

“The bottom line is that things aren’t as bad as people were afraid of about 10 days ago, and now the market is rallying, now it’s making some technical progress getting back above the 50, and that’s just going to create more chasing, more fear of missing out,” Essaye says. “And I think that’s really what’s helping the market these last couple of days.”

“Until something happens to kind of break this little conversation that investors are having with each other where they’re convincing themselves of these things, the market can rally,” Essaye says. “And there’s not a ton on the calendar this week to break that idea.”

Also, click here to view the full Barron’s article published on May 7th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

It’ll be Very Hard for This Market to RallyIf you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

An S&P 500 Priced for Perfection: May MMT Chart

/in , /by

An S&P 500 Priced for Perfection: May MMT Chart: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • May MMT Chart: An S&P 500 Priced for Perfection
  • Manheim Used Vehicle Value Index Raises Questions About Growth

Futures are flat as disappointing earnings in Asia (Toyota and Nintendo) were largely offset by solid guidance from AB InBev and Siemens Energy in Europe while macroeconomic news wires were relatively quiet.

Economically, exports from Taiwan plunged to 4.3% y/y in April from 18.9% in March due to weak Chinese demand but exports to the U.S. hit a record amid strong AI demand. The soft Chinese demand is a concern, but AI optimism is for now offsetting those worries.

There are no notable economic reports today leaving focus on the Fed speaker circuit with Jefferson (11:00 a.m. ET), Collins (11:45 a.m. ET) and Cook (1:30 p.m. ET) all scheduled to speak.

Additionally, there is a 10-Yr Treasury Note auction at 1:00 p.m. ET. Yesterday’s 3-Yr Note auction saw decent demand but if today’s longer duration Note auction is soft, that will put upward pressure on yields and weigh on equity markets as this relief rally has begun to lose momentum.

Join thousands of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.