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The fundamental backdrop of the oil market

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The fundamental backdrop of the oil market: Tyler Richey Quoted in Morningstar

Oil prices end higher on surprise fall in U.S. crude supply, rise in gasoline demand

“The fundamental backdrop of the oil market has become less bearish this week, but it would be a stretch to say that market dynamics are beginning to favor the bulls on any time horizon beyond a few days,” said Tyler Richey, co-editor at Sevens Report Research.

“Concerns about a surplus emerging in the global oil market have been dialed back given the improving consumer-demand figures in [Wednesday’s] EIA report and news that OPEC+ leadership is considering postponing output cuts currently planned for December,” he told MarketWatch.

Also, click here to view the full MarketWatch article published on Morningstar on October 30th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Oil Inventories

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Election Day Scenario Analysis (Good, Bad, Ugly)

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Election Day Scenario Analysis (Good, Bad, Ugly): Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Good/Bad/Ugly Election Scenario Analysis
  • Chart – S&P 500 Violates Critical Uptrend off August Lows

Stock futures turned higher with Asian shares overnight thanks to better-than-expected Chinese economic data as trader focus shifts ahead to Election Day in the U.S.

Economically, China’s October Composite PMI rose to 51.9 vs. (E) 50.4, up from 50.3 in September which supported solid gains in Asian shares overnight with Chinese benchmarks rising more than 2%.

Today, the general elections in the U.S. will clearly dominate the headlines however there is one key economic report to watch shortly after the open: ISM Services PMI (E: 53.5).

There are no Fed officials scheduled to speak ahead of this week’s FOMC meeting however there is a 10-Yr Treasury Note auction at 1:00 p.m. ET that could roil markets if it is much stronger than anticipated (flight to safety) or much weaker than expected (fiscal concerns/higher yields).

Lastly, there are a few earnings to watch today as well with MPC ($0.97) reporting ahead of the open and key semiconductor company SMCI ($0.51) after the close along with tech-focused communications company, LUMN ($-0.20).

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One of the more important lessons I’ve learned

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One of the more important lessons I’ve learned: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

High Yield Bonds May Be Sending an Ominous Message, Says One Analyst

One of the more important lessons I’ve learned in my two-plus decades of watching markets is that bond markets can (and often do) lead stock markets. That’s why we watch bonds so closely. A recent technical breakdown in the high-yield ETF JNK [SPDR Bloomberg High Yield Bond ETF] has caught our attention.

Also, click here to view the full Barron’s article published on October 25th, 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.

Goldilocks data that’s in-line with expectations is the best outcome

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Goldilocks data that’s in-line with expectations is the best outcome: Tom Essaye Interviewed On Yahoo Finance

S&P 500 Sees First Gain This Week as Tesla Up 22%: Markets Wrap

“Goldilocks data that’s in-line with expectations (so not too good or too bad) is the best outcome for a continued rebound in stocks and bonds,” said Tom Essaye at The Sevens Report.

Also, click here to view the full Bloomberg article on Yahoo Finance published on October 24th, 2024. 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.

Expectations for economic growth, inflation, and Federal Reserve policy

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Expectations for economic growth, inflation, and Federal Reserve policy: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

This Stat Shows the Market Is Very Afraid of Election Day

Tom Essaye, founder and president of Sevens Report Research, isn’t so sure. He thinks it comes down to the things that always move the bond market—expectations for economic growth, inflation, and Federal Reserve policy.

Also, click here to view the full Barron’s article published on October 24th, 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.

Unhealthy Price Action and Revisiting Credit Spreads

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Unhealthy Price Action and Revisiting Credit Spreads: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Tech Update – An Unhealthy Start to a Critical Two Weeks
  • What Credit Spreads Are Saying About the Economy and Markets
  • JOLTS Data Takeaways – Available Jobs Fall Below Previous Cycle Peak (2019)

Equities are mixed in pre-market trade as earnings dominate early money flows.

Tech-heavy Nasdaq futures are outperforming and holding overnight gains thanks to solid earnings from GOOG helping to offset disappointing guidance from AMD while CAT earnings are weighing on Dow futures. S&P 500 futures are little changed.

Economically, the Eurozone’s Q3 GDP Flash firmed to +0.4% vs. (E) +0.2% largely thanks to growth in Germany which is easing concerns about the health of the EU economy and that is ultimately resulting in a favorable pullback in the recently strong dollar.

Today, focus will be on economic data early with the ADP Employment Report (E: 115K), and Q3 GDP Report (E: 3.0%) both due out before the bell while Pending Home Sales (E: 1.0%) will be released shortly after the open.

There are no Fed speakers today as they remain in their “blackout period” ahead of next week’s FOMC meeting which will leave traders watching for more earnings. Notable companies reporting today include: LLY ($1.52), CAT ($5.33), and HUM ($3.48) before the open, and  MSFT ($3.08), META ($5.17), and ALL ($2.20) after the close.

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What Yesterday’s “Inside Day” Means for Markets

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What Yesterday’s “Inside Day” Means for Markets: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • What Yesterday’s Inside Day Means for Markets
  • Takeaways From Oil’s Reaction to Israel’s Retaliatory Air Strikes

Futures are flat this morning while global markets rallied modestly overnight amid quiet news flow as traders look ahead to multiple important catalysts looming over the next week.

Economically, data was largely encouraging overnight as the Japanese Unemployment Rate fell to 2.4% vs. (E) 2.5% while the German GfK Consumer Climate Index rose to -18.3 vs. (E) -20.5, however, neither report meaningfully impacted markets.

Looking ahead to the U.S. session, there are several noteworthy economic releases today beginning with a housing market report, the Case-Shiller Home Price Index (E: 5.2%), before we the first labor market report of this critical jobs week, JOLTS (E: 7.9 million), and finally Consumer Confidence (E: 99.1).

There are no Fed officials scheduled to speak today but there is a 7-Yr Treasury Note auction at 1:00 p.m. ET. The 7-yr auction is notable because soft demand in past auction have roiled bond markets and sparked volatility in equities, something to watch for today.

In corporate news, this critical week of earnings begins in earnest today with consumer-focused companies including PYPL ($1.08), MCD ($3.18), and BP ($0.78) reporting before the bell while tech giants AMD ($0.92) and GOOG ($1.83) report after the close along with credit card staple V ($2.58).

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Why the Next Two Weeks Are So Important For This Market

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Why the Next Two Weeks Are So Important For This Market: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Why the Next Two Weeks Are So Important For This Market
  • Weekly Market Preview:  Magnificent Seven Earnings and Important Economic Data
  • Weekly Economic Cheat Sheet:  Jobs and ISM Manufacturing PMI on Friday

Futures are sharply higher following two market-positive geo-political.

In the Mid-East, the Israeli’s response to the Iranian missile attacks was smaller than expected and is viewed as a de-escalation, as oil is down 6% on falling geo-political risks.

In Japan, the ruling LDP party lost its majority in Parliament and looming political gridlock should further delay any BOJ rate hikes (Japanese stocks rose nearly 2% on the news).

Today there are no notable economic reports but as long as oil keeps dropping, the early rally should continue. Finally, earnings season continues and some reports we’ll be watching today include: ON (0.97), F (0.49), WM ($1.86).

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How Bullish Are Investors? (The Answer May Surprise You)

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How Bullish Are Investors? (The Answer May Surprise You): Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • How Bullish Are Investors?  (The Answer May Surprise You)

Futures are modestly higher following a night of solid earnings and mixed economic data.

TSLA is rallying 11% pre-market after posting stronger than expected earnings and that’s helping futures rally.

Economically, EU and UK flash PMIs were mixed but, on balance, Goldilocks enough to support a bounce in stocks.

Today focus will shift from earnings to economic data and the important reports today are:  Jobless Claims (E: 247K), Oct. Flash Manufacturing PMI (E: 47.6) and the Oct. Flash Services PMI (E: 55.0).  Goldilocks data that’s in-line with expectations (so not too good or too bad) is the best outcome for a continued rebound in stocks and bonds today.

We also have one Fed speaker today, Hammack at 8:45 a.m. ET, and some notable earnings including UPS ($1.65), AAL ($0.13) and COF ($3.70).  But, barring any major surprises they shouldn’t move markets.

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Why Yields Are Suddenly Surging

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Why Yields Are Suddenly Surging: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Rising Yields: Is it Growth, the Fed, or Fiscal Worries?
  • Chart: Market Based Inflation Expectations Hit 4-Month Highs

Futures are under pressure again this morning as the 10-Yr yield continues to edge further beyond 4.20%, the highest readings since July, while traders await more important earnings releases today and into the weekend.

Economically, Taiwan’s Industrial Production index, which includes the nation’s critical semiconductor output, slowed to 11.22% in September from a lower revised 12.54% rise in August signaling a potential slowdown in high-tech, AI-focused chips in H2’24.

Today, there is one economic report due out: Existing Home Sales (E: 3.90 million) but unless it is meaningfully “hot” it should not have a major impact on markets (although a cool report that influences less hawkish money flows would be well received by equity markets).

Additionally, there are two Fed speakers to watch: Bowman (9:00 a.m. ET) and Barkin (12:00 p.m. ET) from which markets will look for a less-hawkish, more accommodative tone than the recent “higher-for-longer” policy rate chatter.

Finally, earnings season continues with several notable companies reporting quarterly results including BA ($-10.34), KO ($0.74), and T ($0.59) before the open, and TSLA ($0.58), IBM ($2.27), and TMUS ($2.34) after the close.

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