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Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart
  • What to Make of Yellen’s “Rate Hike” Comments

U.S. stocks futures are recovering some of yesterday’s losses after Treasury Secretary Janey Yellen walked back earlier comments about interest rates after the close yesterday while trader focus shifts to jobs data today.

The Eurozone Composite PMI slightly topped estimates o/n (53.8 vs. E: 53.7) helping EU shares lead global markets higher today.

Looking into today’s session, there are two notable economic reports to watch: the April ADP Employment Report (E: 763K) which will offer the first look at the health of the labor market from last month, and the ISM Services index (E: 64.2). Investors will be looking for a solid ISM Services number today following the disappointing manufacturing print earlier in the week.

There are also three Fed speakers today: Evans (9:30 a.m. & 3:00 p.m. ET), Rosengren (11:00 a.m. ET), and Mester (12:00 p.m. ET) as well as a few notable companies reporting earnings: GM ($1.01), PYPL ($1.01), UBER (-$0.56).

Bottom line, if yesterday’s rate hike/higher interest rate concerns continue to subside this morning, then stocks should be able to stabilize led by a recovery in tech names however any negative surprises in economic data or hawkish comments from any of the Fed speakers could lead to renewed selling pressure today.

Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Table: S&P 500 Chart

U.S. equity futures are little change this morning while international markets were mixed in mostly quiet trade overnight.

Economically, the Eurozone’s Final PMI Composite Index came in at 53.2 vs. (E) 52.5 in March, the latest sign that economic growth is accelerating globally.

Looking into today’s U.S. session, there is just one economic report to watch: International Trade Balance (E: -$70.4B) ahead of the bell while several Fed officials are scheduled to speak over the course of the day: Evans (9:00 a.m. ET), Kaplan (11:00 a.m. ET), Barkin (12:00 p.m. ET), and Daly (1:00 p.m. ET).

The March FOMC Meeting Minutes will also be released at 2:00 p.m. ET and it will be important that both today’s Fed speakers, as well as the Minutes show the FOMC is acknowledging the recent rise in rates but remains ultra-accommodative. Any hawkish hints could cause yields to spike and stocks to give back some of the week-to-date gains.

Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart
  • Was Yesterday the End of Tech Underperformance?

Stock futures are little changed after a mostly quiet night of news as investors look ahead to a key U.S. inflation report and another benchmark Treasury Note Auction.

Economically, Chinese inflation data came in slightly ahead of estimates overnight while French Industrial Production handily topped expectations (3.3% vs. E: 0.5%) however neither release is having a significant impact on markets.

Looking into today’s session market focus will be on inflation data early with the CPI report (E: 0.4%) due out ahead of the opening bell. A “hot” report could spark a move higher in yields which would likely weigh on tech shares and markets broadly. 1.60% is a key level to watch in the 10 year yield as selling pressure on equities has risen significantly in recent sessions when the benchmark yield approaches that mark.

From there, focus will turn to this afternoon’s 10-Yr Treasury Note Auction at (1:00 p.m. ET) as another poor auction for mid-duration Treasuries could also influence a sharp move higher in rates that again would weigh on equity markets, specifically tech.

Bottom line, where stocks go today will largely depend on the price action in the bond markets. If bonds remain orderly, the rebound in equities can continue, however if yields retest recent highs, expect another wave of volatility, especially in high-multiple sectors like tech.

Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart

Stock futures are trading at record highs this morning as mostly underwhelming economic data overnight bolsters the case for more monetary and fiscal stimulus.

Economically, inflation data out of China and Germany narrowly missed estimates while French Industrial Production was disappointing, all of which supports the case for more stimulus to support the global economic recovery.

This morning, market focus will be on the CPI report (E: 0.3%) before the bell, and then attention will shift to Fed Chair Powell’s virtual speech in the early afternoon (2:00 p.m. ET).

Aside from those two key events, there is a 10-Yr Treasury Note Auction at 1:00 p.m. ET, which again has the potential to impact the yield curve (a big enough spike in the 10-year yield would act as a headwind on stocks).

Finally, earnings season continues with a few notable companies releasing Q4 results today: KO ($0.41), GM ($1.62), UBER (-$0.53).

Bottom line, as long as CPI does not run “hot,” Powell maintains a rather dovish tone, and there are no negative developments regarding the stimulus bill, the path of least resistance will remain higher for stocks in the near term.

Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart
  • NFIB Small Business Optimism Index Takeaways

Stock futures are little changed this morning as investors continue to digest the recent sprint to new record highs following a mostly quiet night of news.

Eurozone Industrial Production rose 2.5% vs. (E) 2.3% in November but EU stocks are trading slightly lower due to ongoing, tight economic lockdowns across the continent.

Looking into today’s session there is one economic report to watch this morning: CPI (E: 0.4%), and a “hot” number could trigger a renewed rise in bond yields that would ultimately weigh on stocks.

Meanwhile, there is also a 30-Yr Bond Auction at 1:00 p.m. ET and if demand is strong, as it was for the 10-Yr auction yesterday, that may help stocks stabilize, especially if the inflation numbers come in above expectations.

Finally, it is another busy for the Fed as several officials are scheduled to speak including: Bullard (9:30 a.m. ET), Brainard (1:00 p.m. ET), Harker (2:00 p.m. ET), and Clarida (3:00 p.m. ET), but as long as they all stick to the mostly dovish narrative of recent, they should not have a significant impact on equity markets today.

Market Multiple Levels: S&P 500 Chart

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Today’s Report is attached as a PDF.

Futures are lower with most overseas markets today amid negative COVID-19 trends, no reported progress on stimulus and fading vaccine optimism.

Distribution of Pfizer’s coronavirus vaccine is beginning today in the U.K. but reports suggest far fewer doses will be available than initially thought (as little as half) while hospitalizations continue to hit new highs.

On U.S. stimulus, a stop-gap bill will be voted on tomorrow to buy time to reach an aid package as political gridlock remains.

Looking into today’s session, there is one lesser-followed economic report due to be released: Productivity and Costs (E: 4.9%, -8.9%) which will leave investors largely focused on U.S. stimulus negotiations, Brexit talks, and COVID-19 case/hospitalization trends. If there is disappointment on any of those topics, expect some profit taking in risk-assets as the market remains largely priced-to-perfection.

Market Multiple Levels: S&P 500 Chart

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What’s in Today’s Report:

  • Market Multiple Levels: S&P 500 Chart
  • Growth vs. Value: A Lower-Risk Way to Play the RotationU.S. equity futures are trading comfortably higher this morning as vaccine optimism continues to offset a resurgence in the COVID-19 pandemic and big cap tech stocks are showing signs of stabilizing in pre-market trade.

Daily new cases of the coronavirus hit a new high of over 135,000 in the U.S. yesterday while hospitalizations also hit record levels however investors continue to hold out hope that a vaccine will halt the spread in the coming months and the economy will be quick to normalize.

There are no economic reports today and no Fed officials are scheduled to speak which will leave investors focused on the timeline for the widespread availability of a vaccine and more importantly how quickly it will result in economic normalization.

The election remains a secondary influence on the market as well with Biden having declared victory over the weekend while Trump continues to file lawsuits in swing states about alleged voter fraud. Any further clarity or resolution on the election should act as a tailwind for markets in the near term as it will pull forward the timeline for the next coronavirus aid package.

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What’s in Today’s Report:

  • Market Multiple Levels:  S&P 500 Chart
  • Is the Jobs Market Rolling Over? (ADP Data was Deceiving)

Futures are little changed as solid economic data is offsetting mildly negative stimulus headlines.

Regarding stimulus, the headlines over the last 12 hours were slightly negative (more sticking points are emerging) but the market still expects a deal within the next few days and for that deal to be at the upper end of expectations (the weekly unemployment payments are looking to be $400/week into year-end, which is higher than market expectations).

Economic data was solid as German Manufacturers’ Orders (27.9% vs. (E) 9.6%) and the British Construction PMI (58.1 vs. (E) 57.0) both beat estimates.

Today the focus will be on the weekly Jobless Claims (E: 1.442M), and simply put the market does not want to see any further increases in weekly claims as that implies the recovery is pausing.  A number above 1.5MM will likely put a headwind on stocks today (unless there’s positive stimulus headlines).  There’s also one Fed speaker, Kaplan (E: 10:00 a.m. ET), but he shouldn’t move markets.