Futures are modestly lower as markets digest yesterday’s more…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
The market just had a strong feel to it once things stabilized after an early session washout to the downside. It’s almost as if the overnight run to… said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Stock futures are wavering between gains and losses this morning as traders digest mixed economic data and look ahead to a key inflation report due later in the week.
Economically, Japanese GDP was not as bad as feared in Q1 but German Industrial Production missed estimates as did the U.S. NFIB Small Business Optimism Index which is weighing modestly on sentiment this morning.
There are two economic reports to watch in the U.S. today: International Trade in Goods and Services (E: -$69.0B) and JOLTS (E: 8.045M). The latter will be the more important to watch as investors continue to look for clues regarding the state of the labor market recovery.
No Fed officials are scheduled to speak today however there is a 3-Yr Treasury Note auction at 1:00 p.m. ET and a weak outcome could rekindle taper fears with Thursday’s CPI report coming into focus.
What’s in Today’s Report:
Futures are modestly lower following mixed economic data while the Fed announced it’s winding down one of its pandemic era support programs.
Service PMIs for May were mixed as the Chinese PMI missed estimates while the EU & British PMIs were in-line with expectations, but none of the data is altering the expectation that the global economic recovery is on going.
The Fed announced it’s going to start selling assets from the “Secondary Market Credit Facility” which was the program the Fed used to buy corporate bonds to stabilize markets during March/April of 2020. This has nothing to do with QE, but it is a general reminder that we are seeing central banks removing market support as society returns to normal, and it’s a tangential reminder that tapering of QE is coming at some point.
Today’s focus will be on economic data as we get several notable reports today: ISM Services PMI (E: 63.1), Jobless Claims (E: 400k), and ADP Employment (627k). Generally speaking, markets will want to see “Goldilocks” data from all three reports – close to or better than expectations but not so good they make the Fed think more about tapering. We also have three Fed speakers: Bostic (12:30 p.m. ET), Harker (1:50 p.m. ET), and Quarles (E: 3:05 p.m. ET) but none of them should move markets.
U.S. stock futures are extending yesterday’s gains this morning as easing inflation concerns…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are trading modestly higher in sympathy with global shares which rallied on rising re-opening bets overnight while economic data came in largely as expected.
Economically, Japanese and Eurozone GDP data as well as the U.K. Labour Market Report all printed largely in-line with estimates o/n and did not materially move markets.
Today, there is one economic report: Housing Starts (E: 1.715M) but it should not have a major impact on markets while the Treasury will hold a 52-Week Treasury Bill auction at 11:30 a.m. ET (these shorter duration auctions will become increasingly important as investors gauge the market’s taper/tightening expectations).
Turning to Fed, there are two speakers to watch today: Bostic (11:00 a.m. & 12:30 p.m. ET) and Kaplan (11:05 a.m. ET).
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What’s in Today’s Report:
Futures are modestly higher as markets digest yesterday’s dovish Fed rhetoric while data overnight was solid.
German Manufacturers’ Orders and Euro Zone Retail Sales both beat estimates, again implying the economic recovery in Europe is gaining momentum (this is positive for European stocks).
Fed officials repeated their dovish stance yesterday with Vice Chair Clarida reinforcing it’s not time to think about tapering despite rising inflation and strong growth.
Today focus will be on weekly Jobless Claims (E: 533K) and again markets will want to see them hold the gains of the past few weeks. We also get numerous Fed speakers including (in order of importance): Williams (9:00 a.m. ET), Mester (1:00 p.m. ET), Bostic (1:00 p.m. ET) and Kaplan (10:00 a.m. ET) but we don’t expect any of them to materially move markets.
What’s in Today’s Report:
Futures are modestly higher as markets bounce back from Friday’s decline thanks to solid global economic data.
Economically, German Retail Sales beat estimates, surging 7.7% vs. (E) 3.0% while the final EU manufacturing PMI slightly missed estimates at 62.9 vs. (E) 63.3. But, that’s still a strong number in an absolute sense and implies the EU economy is rebounding from COVID.
Politically, President Biden signaled support for a bipartisan infrastructure plan, which means it will be smaller than proposed but also more likely to pass and become law.
Today the key number will be the ISM Manufacturing PMI (E: 65.0) and markets will want to see continued strength in the U.S. recovery. We also get one Fed speaker, Williams at 2:10 p.m. ET, and it will be interesting to see if he acknowledges that it’s time to “talk about, talking about” tapering QE, like Dallas Fed President Kaplan did on Friday. If so, that could push the 10 year yield slightly higher.
What’s in Today’s Report:
U.S. stock futures are trading lower with most overseas markets as investors digest the recent run to fresh records amid rising COVID-19 cases and mostly upbeat earnings.
German PPI was hotter than expected o/n with a headline of 0.9% (E: 0.5%) but the report is not materially moving markets.
Looking into the U.S. session today, there are no economic reports and no Fed officials are scheduled to speak. There is a 52 Week T-Bill Auction at 11:30 a.m. ET, however, that could influence bond yields and ultimately stocks if the results are far from expectations.
Earnings season will continue to pick up today with JNJ ($2.31), LMT ($6.32), PG ($1.19), and TRV ($2.44) releasing Q1 results ahead of the bell while NFLX ($2.98), CSX ($0.95), and IBKR ($0.90) will report after the close.
Bottom line, markets have been trading with a risk-off tone so far this week amid a resurgence in COVID-19 cases in several global hotspots. And if the news flow regarding the latest regional outbreaks continues to deteriorate, stocks could continue to decline, potentially sharply, as the health of the recovery will come into question.
What’s in Today’s Report:
Futures are moderately higher following a solid start to earnings season (GS/WFC/ABB/TSMC/LVMH all posted good results) and ahead of a lot of economic data later today.
Speaking of today’s data, the key reports to watch today are (in order of importance): Jobless Claims (E: 695K), Empire State Manufacturing Index (E: 17.0), Philadelphia Fed Manufacturing Index (E: 43.0), Retail Sales (E: 5.6%) and Industrial Production (E: 2.8%). As has been the case, markets will want to see solid activity to imply the economic recovery is on-going, but also no hints of building inflation pressures.
There are also several Fed speakers including Bostic (11:30 a.m. ET), Daly (2:00 p.m. ET) and Mester (4:00 p.m. ET). Yesterday Vice Chair Clarida got more forcefully dovish, so we’ll see if that sentiment is echoed by other Fed members today.
Finally, earnings season continues to roll on and we get several notable reports this morning including: BAC ($0.65), C ($2.56), TSM ($0.95), PEP ($1.12), UNH ($4.41), DAL (-$2.94), AA ($0.48), PPG ($3.67).