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MMT Chart: S&P Reaches Technical Tipping Point

MMT Chart: S&P Reaches Technical Tipping Point: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • MMT Chart: Steady Targets Amid Rising Technical Risks
  • Powell Testimony Takeaways – Policy on “Hold” for Now
  • NFIB Shows Fading Optimism Among Small Business Owners

Futures are mixed but little changed and bond yields are flat ahead of today’s critical U.S. CPI release.

Economically, Italian Industrial Production fell -3.1% vs. (E) -0.2% in December which served as a reminder that Europe continues to face significant growth risks.

Traders will be keenly focused on the January CPI (E: 0.3% m/m, 2.9% y/y), and Core CPI (E: 0.3% m/m, 3.2% y/y) release before the bell this morning before focus turns back to Capitol Hill for Powell’s second day of semiannual testimony (10:00 a.m. ET).

A “hot” inflation print is a considerable risk to equities and other risk assets here as hawkish money flows could result in heavy market declines today.

Looking ahead to the afternoon, there is a 10-Yr Treasury Note auction at 1:00 p.m. ET and two additional Fed speakers to watch today: Bostic (12:00 p.m. ET), Waller (5:05 p.m. ET), however CPI and Powell will be the primary market-focus over the course of the session.


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Market Multiple Table: February Update

Market Multiple Table: February Update: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • Market Multiple Table (February Update)
  • NY Fed Inflation Expectations

Stock futures are lower and yields are higher after President Trump officially announced 25% tariffs on steel and aluminum imports late yesterday, reigniting global trade war worries.

Economically, the NFIB Small Business Optimism Index fell to 102.8 in January from December’s multi-year highs of 105.1. The headline missed estimates of 104.7 and underscored fading post-election optimism among business owners.

There are no other economic reports today, however there is a 3-Yr Treasury Note auction at 1:00 p.m. ET. Soft demand, and subsequently higher yields could further pressure equities this afternoon with tomorrow’s CPI report in focus.

Additionally, market focus will be on Capitol Hill today as Fed Chair Powell is set to begin his semi-annual Congressional Testimony at 10:00 a.m. ET. We will also hear from the Fed’s Hammack (8:30 a.m. ET) and Williams (3:30 p.m. ET) today. A dovish tone, and further confidence in a soft economic landing will be favorable for equity markets today.

Finally, earnings season continues today with reports from SHOP ($0.43) and KO ($0.51) before the bell and SMCI ($0.54) after the close.


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Earnings and economic growth are still solid

Earnings and economic growth are still solid: Sevens Report Analysts Quoted in Investing.com


Are tariffs a gamechanger for the S&P 500?

While the tariffs add another headwind for equities, Sevens Report argues that they do not warrant an immediate reduction in equity exposure.

“Earnings and economic growth (the two most important foundational forces for stocks) are still solid,” the analysts wrote. However, they caution that “the factors that push stocks higher are being weakened or eliminated one-by-one,” while downside risks are mounting.

“These tariffs potentially undermine that positive price action from the ‘rest’ of the market and could weigh on other sectors while DeepSeek weighs on tech,” the analysts noted.

“Most still believe this is all a negotiation and that the tariffs won’t be on for long (and that’s still probably right),” the report states. However, with AI uncertainty and elevated valuations already straining investor sentiment, Sevens Report warns that “the recipe is coming together for a solid and extended pullback.”

Also, click here to view the full article published on February 3rd, 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.


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This accelerated approach has generated 3.5% annualized alpha

This accelerated approach has generated 3.5% annualized alpha: Sevens Report Analysts Quoted in Investing.com


Analyst explains 2 sector rotation strategies with proven outperformance

According to Sevens, this accelerated approach has generated 3.5% annualized alpha versus the S&P 500.

The second strategy called the Cheapskate Sector Strategy, involves buying the sector with the lowest price-to-earnings ratio from the previous year.

Sevens notes that the contrarian approach, while more psychologically challenging, has historically paid off, delivering an annualized return of 12.6% over 34 years. It has outperformed the S&P 500 in 20 of those years, with a 59% win rate. For 2025, Energy is the cheapest sector in the S&P 500 based on trailing P/E.

Sevens Report notes that while these strategies don’t work every year, their long-term success rates exceed those of most active managers.

Also, click here to view the full article published on January 31st, 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.

Are Tariffs A Bearish Gamechanger? Not Yet.

Are Tariffs A Bearish Gamechanger? Not Yet.: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • Are Tariffs A Bearish Gamechanger?  Not Yet.
  • Weekly Market Preview:  Tar War 2.0 and Key Economic Data (Including Friday’s Jobs Report)
  • Weekly Economic Cheat Sheet:  The “Big Three” Monthly Reports (Highlighted by Friday’s Jobs Report)

Futures are sharply lower (more than 1%) after President Trump made good on threats and placed 25% tariffs on Canada and Mexico in addition to an incremental 10% tariff on China, igniting another round of trade wars.

Economically, EU and UK manufacturing PMIs were slightly better than expected but both still were solidly in contraction territory, reinforcing EU and UK growth concerns.

Today could be a very busy day in the markets.  Obviously trade rhetoric will dominate trading today and to that end, Trump has calls planned today with Canadian PM Trudeau and Mexican President Sheinbaum and obviously those headlines will move markets.  Outside of trade drama, however, we get an important economic report, the ISM Manufacturing PMI (E: 49.5) and markets will want to continue to see Goldilocks readings close that are in-line or slightly weak.

In addition to trade drama and an important economic report, we also have two Fed speakers, Bostic (12:30 p.m. ET) and Musalem (6:30 p.m. ET) and their commentary on future cuts could also move markets.


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What Would Cause the Fed to Cut Rates Again? (Two Answers)

What Would Cause the Fed to Cut Rates Again? (Two Answers): Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • What Would Cause the Fed to Cut Rates Again? (Two Answers)

Futures are modestly higher despite mixed tech earnings.

TSLA (up 3% pre-market) and META (up 1% pre-market) results were “fine” while MSFT disappointed (MSFT down  4% pre-market) but none of the results were surprising enough to impact the broader tech sector.

Today will be a busy day of economic data and earnings including, in order of importance, the ECB Rate Decision (E: 25 bps cut), Jobless Claims (E: 224K), Advanced Q4 GDP (E: 2.7%) and Pending Home Sales (E: 0.4%).  And, following yesterday’s Fed meeting, it remains the case that in-line to slightly weak results are the “best” case for stocks as they imply solid growth but keep rate cut expectations stable.

On earnings, the key results today include: AAPL ($2.36), INTC ($0.12), V ($2.66), UPS ($2.52), MA ($3.68), CAT ($4.97).


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Can Stocks Go Back-to-Back-to-Back?

Can Stocks Go Back-to-Back-to-Back?: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • Can Stocks Go Back-to-Back-to-Back?
  • Why CPI Was An Important Positive for Markets
  • EIA Analysis and Oil Market Update

Futures are modestly higher thanks mostly to solid earnings and guidance from Taiwan Semiconductor (TSM).

For AI related tech companies, guidance will be key this earnings season and TSM posted better than expected revenue guidance and the stock is up 5% pre-market.

Economic data overnight largely met expectations.

Today will be a busy day of notable economic data and earnings.  On the economy, we get several important reports today including, in order of importance, Retail Sales (E: 0.5%), Jobless Claims (E: 214K), Philly Fed (E: -8.0) and the Housing Market Index (E: 46).  As has been the case, data that meets or slightly misses expectations is the “best” case for markets (while very strong data will boost yields and pressure stocks).

On earnings, the Q4 reporting season is just starting to ramp up and some important results we’re watching today include BAC ($0.77), MS ($1.65), UNH ($6.71), JBHT ($1.63).


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Market Multiple Table: January Update

Market Multiple Table: January Update: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • Market Multiple Table – January Update

Futures are higher with global stock markets thanks to easing tariff policy worries and fading geopolitical angst.

After the close yesterday, Bloomberg reported Trump’s economic team is planning gradual tariff increases (2%-5% per month) rather than large, one-time hikes which is easing worries about the immediate impact on both growth and inflation.

Geopolitically, the WSJ reported Israel and Hamas are working on a ceasefire deal that could be finalized as soon as today. If successful, the deal would favorably remove a lingering source of market uncertainty.

Looking into today’s session, trader focus will be on inflation data early with the December PPI report due before the open (E: 0.3% m/m, 3.3% y/y). A “cooler” than expected report would likely trigger a continued relief rally in equity markets amid stabilizing bond yields.

There are no other notable economic reports today, but two Fed officials are scheduled to speak: Schmid (10:00 a.m. ET) and Williams (3:00 p.m. ET), and because hawkish money flows have been a major source of volatility in equities recently, their commentary has the potential to move markets today. A more dovish-leaning tone from both would be the most favorable outcome for equities today.


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Sevens Report Research founder Tom Essaye Interviewed on Yahoo Finance

Tom Essaye Interviewed On Yahoo Finance


Trump’s economic policy impact, US dollar: Asking for a Trend

“Sevens Report Research founder Tom Essaye outlines what investors need to know to separate the headlines that matter to the market from the noise.

Also, click here to view the full interview with Yahoo Finance published on January 8th, 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.

Investors will want to see a return to Goldilocks data

Investors will want to see a return to Goldilocks data: Tom Essaye Quoted in SwissInfo.ch


Wall Street Braces for Jobs Jolt as Stocks Churn: Markets Wrap

“Investors will want to see a return to Goldilocks data, consistent with a cooling labor market to help temper the recent spike in yields and help stocks stabilize,” said Tom Essaye at The Sevens Report.

Also, click here to view the full article published on January 8th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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Lastly, 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.