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It’s unlikely to materially impact the markets

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It’s unlikely to materially impact the markets: Sevens Report President, Tom Essaye, Quoted in Xinhua

U.S. stocks rebound as investors brush off Middle East tensions

Despite lingering geopolitical concerns, historically low equity positioning and resilient fundamentals may be keeping a broader sell-off at bay, allowing risk appetite to return for now. “Focus will remain on geopolitical headlines, but as long as the conflict stays limited between Israel and Iran, it’s unlikely to materially impact the markets,” said Tom Essaye at the Sevens Report.

Also, click here to view the full article, published on June 17th, 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.

Why markets appear relatively immune to the negative headlines

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Why markets appear relatively immune to the negative headlines: Sevens Report President, Tom Essaye Quoted in MarketWatch

Why markets are ignoring scary headlines about Iran, trade wars and U.S. debt

Strategist Tom Essaye explained why markets appear relatively immune to the negative headlines in the Sevens Report, his daily market-strategy note.

However, Iran’s military capabilities have been so degraded, Essaye wrote, that Tehran’s ability to respond to Israel’s missile strikes and to counter its overall military superiority is severely inhibited.

According to Essaye, tariff fatigue has caused complacency to set in. There are too many headlines and deadlines for the average investor to follow accurately, and markets now routinely dismiss Trump’s ultimatums as bluff and bluster, as evidenced by the recent coinage “TACO,” or “Trump Always Chickens Out.”

The next significant deadline is July 9, the end of the 90-day pause in the imposition of Trump’s tariffs, and at that time markets may well reassess their current phlegmatic approach. Right now, however, Essaye believes that “markets are so [convinced about] TACO that it’s going to take a sustained tariff increase to shake the belief.”

After recently piercing the 5% level, though, 30-year Treasury bonds have rallied, implying that investors are not yet sufficiently worried about the U.S. fiscal situation to sell off Treasury bonds aggressively, Essaye wrote.

“If the 10-year yield begins to creep towards and through 5.00%, that will be a signal that the global bond markets are starting to worry about the U.S. fiscal situation and at that point, markets will care about deficits and debt, a lot! (and we should expect stocks to be sharply lower),” he said.

Also, click here to view the full MarketWatch article, published on June 16th, 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 Moody’s Downgrade Means for Markets (Two Important Charts)

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What’s in Today’s Report:

  • What the Moody’s Downgrade Means for Markets
  • Two Important Charts: Interest Expense and Deficits

Futures are modestly lower this morning as the S&P 500’s six-day rally is being digested amid a steadying Treasury market after the Moody’s downgrade of the U.S. last week.

There were positive trade war headlines out of Japan, Vietnam, and India overnight helping global stocks rally while economically, German PPI favorably fell -0.9% vs. (E) -0.5%.

Looking into today’s session, there are no notable economic reports in the U.S., however the Treasury will hold a 6-week Bill auction at 11:30 a.m. ET which could shed light on the market’s near-term Fed policy expectations, but barring any big surprise, the auction is not likely to move markets.

There are a handful of Fed speakers today including: Barkin & Bostic just ahead of the bell (9:00 a.m. ET), and Musalem in the early afternoon (1:00 p.m. ET). A “higher-for-longer” shift in Fed policy outlook has been priced in recently, so any dovish commentary out of the Fed officials would be well received.

Finally, some late season earnings will continue to be released today including: HD ($3.59), PANW ($0.41), TOL ($2.86).

There are three core drivers behind the shift in sentiment

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There are three core drivers behind the shift in sentiment: Sevens Report Analysts Quoted in Investing.com

Here are 3 key reasons why markets are rallying

According to the Sevens Report, there are three core drivers behind the shift in sentiment, even as some analysts remain skeptical about the sustainability of the surge.

“In the past month, the S&P 500 has surged basically 10%, the VIX has dropped from 30 to 18 and sentiment indicators have swung more bullish,” Sevens wrote.

“Tariff levels aren’t enough to derail the economy,” Sevens said. Despite isolated price increases, like a 40% jump in the price of a Barbie at Target, Sevens notes that “if tariffs rates are 10%,” and cost absorption is split among supply chain players, the consumer burden remains limited.

“Once that’s obvious, the Fed will cut rates and further support stocks,” wrote the firm.

“However, I do think they’re aggressive right now and as such, I continue to think that while short-term momentum is bullish, chasing stocks here remains an unattractive risk/reward proposition.”

Also, click here to view the full article featured on Investing.com published on May 15th, 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.

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 market may react with a “sell the fact” scenario

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The market may react with a “sell the fact” scenario: Tom Essaye Quoted in GuruFocus

Trade Uncertainty Looms Over S&P 500 Despite Recent Gains

Tom Essaye, founder of Sevens Report Research, noted that the Trump administration has significantly weakened the April 2 tariff statement, delaying implementation and exempting key import categories such as chips, electronics, pharmaceuticals, and automobiles. Although the market has recovered losses post “Liberation Day,” the S&P 500 is still down 3.9% for the year despite a nine-day rally, the longest since November 2004.

Essaye warns that when a trade agreement is finally announced, the market may react with a “sell the fact” scenario. Although trade tensions appear to be easing, new tariffs remain higher than January levels, posing growth headwinds.

Essaye suggests shifting to defensive sectors like utilities, consumer staples, and healthcare for risk mitigation. He also recommends diversified investments through the Invesco S&P 500 Equal Weight ETF (RSP) and favors low volatility funds like iShares MSCI USA Min Vol Factor ETF (USMV) and high-quality stock funds (QUAL).

Also, click here to view the full article featured on MSN GuruFocus, published on May 5th, 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.

A ‘sell-the-news’ move

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A ‘sell-the-news’ move: Tom Essaye Quoted in Investor’s Business Daily

Dow Jones Breaks Winning Streak On Trump Tariff Move; Nvidia, Tesla Fall As Palantir Sinks

Tom Essaye, founder and president of Sevens Report Research, cautioned that much of Trump’s backtracking on tariffs may already be priced in.

“A ‘sell-the-news’ move once some trade deals are announced” may lead to some more volatility, Essaye said in a note to clients.

Also, click here to view the full Investor’s Business Daily article featured on MSN, published on May 5th, 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.

The Trump administration has seriously backtracked on the April 2 announcement

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The Trump administration has seriously backtracked on the April 2 announcement: Tom Essaye Quoted in MarketWatch

Why the stock rally may be in trouble after the White House ‘backtracked’ on tariffs

The U.S. stock market has already priced in backtracking on the large and sweeping “liberation day” tariffs announced by President Donald Trump on April 2, making it difficult for the market to keep up its recent rally, according to Sevens Report Research.

“The Trump administration has seriously backtracked on the April 2 announcement, including a delay while negotiations take place and exempting major categories of imports,” said Tom Essaye, founder and president of Sevens Report Research, in a note Monday. As an example of tariff exemptions, Essaye pointed to computer chips, electronics, pharmaceuticals and automobiles.

“The reality of the past month post-‘liberation day’ hasn’t been as bad as feared and the market has recouped those losses,” said Essaye. “However, I do not think these events are enough to sustainably propel the S&P 500 forward and I am sticking to my general 5,100-5,500-ish range.”

Investors, worried that large tariffs will place a drag on the U.S. economy while increasing the cost of goods for consumers, have been monitoring the White House’s negotiations with its trading partners. But with backtracking on tariffs already priced into the market, Essaye cautioned that “we could even see a ‘sell-the-news’ move once some trade deals are announced.”

Also, click here to view the full article featured on MarketWatch published on May 5th, 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.

Jobs Day

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What’s in Today’s Report:

  • Jobs Day
  • Will “Sell in May and Go Away” Work This Year?
  • Interesting Signal from the VIX

Futures are modestly higher as positive trade comments from China offset disappointing earnings overnight.

China’s Commerce Ministry issued a statement saying it was potentially open to trade talks with the U.S., stoking speculation that trade negotiations will begin soon.

Earnings overnight were soft as AAPL (down 3% pre-market) and AMZN (-1.3% pre-market) both disappointed.

Today focus will be on the jobs report and expectations are as follows:  130K Job-Adds, 4.2% Unemployment Rate, 3.9% y/y Wage Growth.  Put simply, the stronger this number, the better, as it’s almost impossible that it’ll come in too hot while a strong number (ideally with tame wages) will push back on stagflation fears.

On earnings, the peak of the season is now behind us (on balance it’s been better than feared) but there are a few notable reports to watch today: XOM ($1.74), CI ($6.39), CVX ($2.15).