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Are Markets Giving An “All Clear” Signal?

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What’s in Today’s Report:

  • Are Markets Giving An “All Clear” Signal?
  • Weekly Market Preview:  Can This Rebound Hold?
  • Weekly Economic Cheat Sheet:  The First National Numbers for May (This Thursday)

Futures are lower (down more than 1%) following the Moody’s downgrade of U.S. debt Friday afternoon.

The Moody’s downgrade wasn’t dramatic news (S&P and Fitch downgraded U.S. debt years ago) but it is pushing the 10 year yield higher and that’s weighing on futures.

Economically, Chinese economic data underwhelmed (Retail Sales and Industrial Production missed estimates).

Today focus will be on economic data and Fed speak.  Economically, Leading Indicators (E: -0.7%) is the most notable report while we have several Feds speakers including: Williams & Bostic (8:30 a.m. ET), Jefferson (9:45 a.m. ET) and Logan (1:15 p.m. ET).  If they echo Powell from last week and are somewhat dismissive of near-term rate cuts, that could add to the headwinds on stocks today.

Alleviate consumer-demand concerns and recession worries

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Alleviate consumer-demand concerns and recession worries: Tyler Richey, editor of Sevens Report Technicals Quoted in MarketWatch

U.S. oil prices settle at highest in 3 weeks as trade-war optimism eases consumer-demand concerns

U.S. benchmark oil prices settled Tuesday at their highest in three weeks, as trade-war optimism helped “alleviate consumer-demand concerns and recession worries,” said Tyler Richey, co-editor at Sevens Report Research.

A multiyear low in annualized U.S. headline inflation was also a “welcomed surprise that effectively poured gasoline on an already raging risk-on fire across financial markets since the better-than-anticipated outcome of the U.S.-China trade negotiations over the weekend,” he told MarketWatch.

A continued relief rally seems to be likely in the weeks ahead, with the $70- to $72-a-barrel range the “first logical upside price target for WTI,” said Richey.

Also, click here to view the full article featured on MarketWatch published on May 14th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If 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.

Understanding the New Bullish Argument

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What’s in Today’s Report:

  • Understanding the New Bullish Argument

Futures are moderately weaker on digestion of the recent rally following a mostly quiet night of news.

There were no notable trade headlines overnight but President Trump did say they were “close” to a nuclear deal with Iran and that is pressuring oil (down 3%). Today there is a lot of potentially important economic data including, in order of importance:   Retail Sales (E: 0.1%), Jobless Claims (E: 229K), PPI (E: 0.2% m/m, 2.4% y/y), Philly Fed (E: -10.0) and Empire Manufacturing (-7.5).  Put simply, the stronger the growth data the better for stocks (pushes back against recession fears) and the lower the PPI reading, the better for stocks (pushes back against inflation fears).

There are two Fed speakers today including Powell (8:40 a.m. ET) and Barr (2:05 p.m. ET) but they commentary is expected to focus on regulation so it shouldn’t move markets.

Finally, there are some notable retail earnings to watch today: WMT ($0.57), BABA ($1.48), DE ($5.68).

May MMT Chart

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What’s in Today’s Report:

  • May MMT Chart
  • CPI Takeaways

Futures are flat after a mostly quiet night of news that included benign inflation data overseas while traders digest the fastest recovery from YTD losses since the 1980s.

Economically, April inflation data was mixed overnight as Japanese PPI fell to 4.0% vs. (E) 3.8% y/y while German CPI met estimates at 2.1% y/y last month.

There are no notable economic reports today but two Fed officials are scheduled to speak: Jefferson (9:10 a.m. ET) and Daly (5:40 p.m. ET). Neither are likely to move markets, however Fed policy expectations have shifted more hawkish in recent weeks so any dovish leaning comments could support a continued move higher in equities today.

On that same vein, there is a 4-Month Treasury Bill auction at 11:30 a.m. ET. Those Bills will mature around the time of the September Fed meeting, so strong demand would be dovish for markets while weak demand could spark hawkish money flows and result in some profit taking in risk assets.

Finally, there are a few more late season earnings releases due out today including SONY ($0.12) and CSCO ($0.75) but given optimism for new AI-chip deals overseas, neither report should be able to derail this week’s rally.

The reality of the trade war won’t be as bad as feared back in early April

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The reality of the trade war won’t be as bad as feared back in early April: Sevens Report Analysts Quoted in Investing.com

Where is the ’Trump Put’ now? Analyst weighs in

According to Sevens Report analysts, that rebound is largely thanks to easing fears around trade war escalation and renewed optimism from the Trump administration.

“The reality of the trade war won’t be as bad as feared back in early April,” Sevens wrote, citing a larger-than-expected U.S.-China tariff reduction and “lots of Trump ‘happy talk’ on trade” involving potential deals with the U.K., South Korea, Japan, and India.

But Sevens cautioned investors not to mistake this relief rally for a sustainable bull run. “While I’m enjoying this morning’s rally I remain skeptical this news can push the S&P 500 sustainably towards (or above) 6,000,” the note said.

The more important takeaway, according to the firm, is that the so-called “Trump Put” — the idea that Trump will pivot policy to support markets if stocks fall far enough — appears to have moved higher.

“Markets freaked out in early April because, in part, investors feared the Trump Put wouldn’t occur until the S&P 500 was well in the 4,000s,” Sevens explained. “But the past few weeks implied the Trump Put kicks in somewhere in the mid-to-low 5,000s.”

Also, click here to view the full article featured on Investing.com published on May 12th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If 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.

May Market Multiple Table Update

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What’s in Today’s Report:

  • May Market Multiple Table Update

Stock futures are lower as traders digest yesterday’s sizeable risk-on rally but U.S. futures are off their overnight lows thanks to better than expected global economic data as market focus shifts to today’s CPI release in the U.S.

The Economic Sentiment Index of the German ZEW Survey jumped from -14.0 to +25.2 vs. (E) 0.0 while the U.S. NFIB Small Business Optimism Index came in at 95.8 vs. (E) 94.7.

Looking into today’s session, trader focus will be on inflation data with CPI (E: 0.3% m/m, 2.4% y/y) as well as the Core CPI figure (E: 0.3% m/m, 2.8% y/y) due to be released before the bell.

If the inflation report is inline with estimates or “cooler-than-feared,” expect yesterday’s big stock market gains to hold or for stocks to even extend the already sizeable WTD rally on bullish momentum.

Finally, a few noteworthy earnings releases today include: JD ($0.99), HMC ($0.72), and SE ($0.61), however the bulk of the Q1 reporting season is behind us and the market impact should be limited.

Their comments shouldn’t move markets

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Their comments shouldn’t move markets: Tom Essaye, editor of the Sevens Report Quoted in MarketWatch

It’s a busy day for Fedspeak — but there’s one official worth listening to

“However, unless Williams is hawkish, their comments shouldn’t move markets,” said Tom Essaye of The Sevens Report.

Also, click here to view the full article featured on MarketWatch published on May 6th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If 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.

What the Fed Decision Means for Markets

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What’s in Today’s Report:

  • What the Fed Decision Means for Markets

Futures are moderately higher on more trade optimism.

President Trump posted on social media that he would announce a new trade deal this morning (likely with the UK) and this is driving optimism for more tariff relief.

Economically, the only notable report was German Industrial Production, which beat estimates (3.0% vs. (E) 2.7%).

Today focus will remain on economic data and specifically Jobless Claims (E: 232K), as investors will want to see claims decline from last week’s spike.  If claims continue to rise, that will increase economic anxiety (and likely pressure stocks).  Other economic events today include a BOE Rate Decision (E: 25 bps cut) and U.S. Unit Labor Costs (E: 5.2%), which are an important measure of inflation (and again, the lower this number, the better).

On earnings, the season is virtually over but there are a few notable reports today:  SHOP ($0.17), COP ($2.06),  COIN ($2.04), MELI ($7.67), AFRM ($-0.08).

Monthly Bitcoin & Crypto Update

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What’s in Today’s Report:

  • Monthly Bitcoin & Crypto Update

Futures are higher on news the U.S. and China will hold preliminary trade talks in Switzerland Saturday which offset soft tech earnings from SMCI as focus turns to the Fed.

Economically, German Manufacturing Orders jumped 3.6% vs. (E) 1.0% while EU Retail Sales fell -0.1% vs. (E) 0.0%.

Looking ahead to the U.S. session, there is one economic report this afternoon: Consumer Credit (E: $10.0B), but the data is unlikely to move markets given the afternoon Fed decision.

Trader focus will be on any trade headlines this morning before attention turns to the Fed with the FOMC Announcement (2:00 p.m. ET), and Fed Chair Press Conference (2:30 p.m. ET) mid-afternoon.

There are some more late season earnings releases to watch that could move markets in pre-market/after-hours trade including: UBER ($0.51), DIS ($1.18), GOLD ($0.29), CVNA ($0.75), OXY ($0.73), and CLF ($-0.78).

Bottom line, focus is on the Fed today and while no change in the policy rate is expected, traders will be scrutinizing the meeting statement for any changes regarding economic uncertainty or hints on when the FOMC may lower rates next during Powell’s press conference. The more dovish the language and commentary, the better for equities today.

The “more forceful” a signal of a rate cut in June “the better

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The “more forceful” a signal of a rate cut in June “the better: Sevens Report Analysts Quoted in Investing.com

Investors likely to focus on potential Fed June rate cut guidance – Sevens Report

In a note to clients, the Sevens Report analysts said the “more forceful” a signal of a rate cut in June “the better”, adding that they will also be noting how U.S. President Donald Trump reacts to the Fed’s latest decision.

“It is widely known and expected that the Fed won’t cut rates [in May], but despite that being the consensus expectation, the lack of action may draw the wrath of President Trump,” the Sevens Report analysts wrote.

Also, click here to view the full article featured on Investing.com published on May 6th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If 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.