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Markets are counting on inflation to stay subdued

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Markets are counting on inflation to stay subdued: Sevens Report President, Tom Essaye Quoted in MarketWatch

What’s up with inflation? PCE likely to show a small rise in prices despite tariffs.

“Markets are counting on inflation to stay subdued to keep expectations for two rates cuts in 2025 intact,” wrote Tom Essaye of Sevens Report Research. “If inflation surprises to the upside — which is unlikely given CPI and PPI were light — then that will push yields higher and pressure stocks.”

Also, click here to view the full MarketWatch article, published on June 26th, 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.

Investor Sentiment Update: Not As Bullish as You Might Think

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What’s in Today’s Report:

  • Investor Sentiment Update:  Not As Bullish as You Might Think

Futures are modestly higher thanks to a dovish WSJ article on the Fed overnight.

The WSJ reported President Trump will employ a “Shadow Fed” strategy and name Powell’s replacement in the coming months.  That replacement is expected to be more dovish than Powell and that’s weighing on the dollar and boosting futures.

Today focus will be on economic data and the key reports to watch include (in order of importance):  Jobless Claims (E: 245K), Durable Goods (E: 0.1%) and Final Q1 GDP (E: -0.2%).  Given this week’s slight dovish drift in the Fed, markets will want to see stable data further the idea of rate cuts in the next two to three months.

Speaking of the Fed, there are several speakers today including Barkin (8:00 a.m. ET), Hammack (9:00 a.m. ET) and Barr (1:15 p.m. ET).  Markets will be looking to see if any of them also float the idea of a July rate cut.  If so, it won’t make a July cut more likely, but it will further solidify expectations for a September cut (which will be a mild tailwind on stocks).

New ETFs for Your Watchlist (June Update)

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What’s in Today’s Report:

  • New ETFs for Your Watchlist – June Update
  • Powell Testimony Takeaways
  • Chart – Consumer Confidence Tumbles (Again)

Futures are flat as investors digest reports that the U.S. strikes on Iran nuclear facilities resulted in limited damage while focus remains on Powell’s semi-annual testimony.

There were no noteworthy economic reports overnight and financial news wires were mostly quiet since yesterday’s close.

Today, there is one economic report to watch with New Home Sales (E: 694K) due out just after the bell. Housing data has been trending weaker but that has bolstered dovish money flows so a “hot” print could spark a hawkish reaction and weigh on stocks.

Fed Chair Powell’s semi-annual Congressional testimony continues today at 10:00 a.m. ET which will be a primary focus for markets as investors look for clues as to when the FOMC will resume cutting interest rates.

Moving into the afternoon, there is a 5-Yr Treasury Note auction at 1:00 p.m. ET. Demand has been strong in recent weeks so a weak outcome that sends rates higher is a hawkish risk to watch for that would weigh on risk assets.

Finally, there are a few more late-season earnings reports to watch including PAYX ($1.18), GIS ($0.71), MU ($1.61), and JEF ($0.43).

 

Sevens Report Q2 ’25 Quarterly Letter Coming Next Tuesday

The first half of 2025 has been historically volatile, with tariffs, the Iran/Israel war, no Fed rate cuts and a 14% drop in the S&P 500 in April!

This is the type of environment where investors are anxious and want to hear from their advisor and a quarterly letter is the perfect tool to help demonstrate your market knowledge and differentiate yourself from the competition.

We will be releasing the Q2 2025 Sevens Report Quarterly Letter to subscribers next Tuesday, July 1. 

The Sevens Report Quarterly Letter is a turnkey client communications solution. We use our strength (writing about the markets) to help you:

  • Save time (an average of 4-6 hours per quarterly letter),
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  • Strengthen client relationships all with little-to-no work from you.

You can view our Q1 ’25 Quarterly Letter here.

To learn more about the product (including price) please click this link, and if you’re interested in subscribing please email info@sevensreport.com.

What Would Make Markets Care About the Israel-Iran Conflict?

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What’s in Today’s Report:

  • What Would Make Markets Care About the Israel-Iran Conflict?
  • June Flash PMI Takeaways

U.S. equity futures are tracking global shares higher after President Trump announced a ceasefire between Israel and Iran, greatly reducing geopolitical worries.

Economically, the Business Expectations component of the German Ifo Survey rose to 90.7 vs. (E) 89.8 in June which is adding to optimism that a recession will be avoided in most developed nations in 2025.

Looking into today’s session, there are multiple economic reports due to be released including the Case-Shiller Home Price Index (E: 4.0%), FHFA House Price Index (E: 0.1%), Consumer Confidence (E: 99.0), and Richmond Fed Manufacturing Index (E: -7.0).

There are also multiple Fed speakers on the calendar to watch with Hammack (9:15 & 10:15 a.m. ET), Powell (10:00 a.m. ET), Williams (12:30 p.m. ET),  and Collins (2:05 p.m. ET) all due to deliver remarks today.

Finally, some noteworthy earnings releases to keep an eye on include CCL ($0.24), SNX ($2.56), FDX ($5.93), and BB ($0.00).

Bottom line, the two most important catalysts to watch today will be the Consumer Confidence release with investors looking for a healthy/better than expected headline and easing inflation expectations, and Powell’s Humphrey-Hawkins testimony on Capitol Hill as investors gauge the prospects for a July rate cut (the more dovish expectations are, the better for stocks).

Two Analogies to Explain Tariffs to Clients

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What’s in Today’s Report:

  • Two Analogies to Explain Tariffs to Clients
  • Weekly Market Preview:  How Does Iran Respond? (And Does That Increase Worries About the Conflict Spreading?)
  • Weekly Economic Cheat Sheet:  More Important Growth Data This Week

Futures are slightly higher despite an increase in geopolitical tensions over the weekend.

The U.S. attacked and destroyed three Iranian nuclear facilities over the weekend. But, despite ominous headlines, we are not seeing an increase in oil prices or geopolitical tensions in the markets as fears of the conflict spreading remain low.

Today focus will remain on geopolitics and specifically how Iran responds to the direct U.S. attack.  Despite the headlines about this event, from a market standpoint, unless investors fear the conflict will spread and engulf the entire region and dramatically reduce oil supplies, then rising geopolitical tensions won’t be a material negative on this market.

Economically, there are two notable reports today: Flash Manufacturing PMI (E: 51.1) and the Flash Services PMI (E: 52.9) and markets will want to see stability in both to push back on slowdown fears. On the Fed front, there are multiple speakers today including Bowman (10:00 a.m. ET), Goolsbee (1:10 p.m. ET), Kugler & Williams (2:30 p.m. ET). But, with Powell’s testimony before Congress starting tomorrow, these speakers shouldn’t move markets.

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.

Focus will remain on geopolitical headlines

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Focus will remain on geopolitical headlines: Sevens Report President, Tom Essaye, Quoted in Gulfnews.com

Oil rises, US futures drop on Trump Tehran warning: Markets wrap

“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.

The disconnect between scary headlines dominating the news cycle and markets’ ongoing rally

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The disconnect between scary headlines dominating the news cycle and markets’ ongoing rally: Sevens Report President, Tom Essaye, Quoted in Barron’s

4 Ways to Find Winners in a Rising Market

“The gap between what we (and investors and clients) are reading daily in the mainstream and financial media is wide and getting wider,” notes Sevens Report President Tom Essaye, citing the disconnect between “scary headlines” dominating the news cycle and markets’ ongoing rally.

Also, click here to view the full 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.

FOMC Technical Preview

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What’s in Today’s Report:

  • FOMC Technical Preview
  • Retail Sales Data Takeaways – Signs of Weakness in Consumer Spending

Futures are higher as investors continue to monitor the geopolitical tensions in the Middle East and digest largely as expected European inflation data ahead of the Fed.

Economically, Eurozone HICP fell to 1.9% from 2.2%, as expected, while UK CPI edged down to 3.4% vs. (E) 3.5% which is supporting a bid in the global bond market with yields falling moderately in premarket trade.

Today, there are two economic reports to watch: Jobless Claims (E: 244K) which come a day early, and Housing Starts and Permits (E: 1.360M, 1.430M). Another sharp rise in jobless claims could bolster concerns about the health of the labor market but a big reaction from markets is unlikely given the looming Fed decision.

Speaking of which, the primary focus of today’s session will be the FOMC Announcement (2:00 p.m. ET) and Fed Chair Powell’s press conference (2:30 p.m. ET) as investors look for clarity on the future path of monetary policy.

There are two late season earnings releases to watch as well: ACB ($0.11) and KFY  ($1.25) but with the Fed in focus, neither should materially move markets today.

FOMC Meeting Preview

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What’s in Today’s Report:

  • FOMC Preview
  • Empire State Manufacturing Survey Takeaways

Futures are lower amid an elevated sense of market uncertainty after President Trump left the G-7 summit early as tensions between Israel and Iran remain elevated.

Economically, Economic Sentiment within the latest German ZEW Survey rose from 25.2 to 47.5 vs. (E) 31.3, however European stocks are trading with a heavy tone amid the elevated geopolitical tensions in the Middle East.

Today, there are several noteworthy economic reports to watch including: Retail Sales (E: -0.6%), Import & Export Prices (E: -0.3%, -0.1%),  Industrial Production (E: 0.1%), Business Inventories (E: 0.0%), and the Housing Market Index (E: 36).

Beyond the economic data, the June FOMC meeting gets underway today which should prompt a sense of “Fed paralysis” as investors await clarity on the future path of monetary policy.

Finally, there are two late-season earnings releases to watch: JBL ($2.15) and LZB ($0.93) but neither should move the broad markets as focus shifts to the Fed decision.