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Investors are on edge the Fed may delay rate cuts

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Investors are on edge the Fed may delay rate cuts: Sevens Report Founder, Tom Essaye, Quoted in MarketWatch

A ‘too hot’ jobs report poses biggest risk to stock-market rally: strategist

The setup for the stock market heading into the release of the Labor Department’s April employment report at 8:30 a.m. Eastern time is a bit out of the ordinary, Tom Essaye, founder of Sevens Report Research, said in a Thursday note.

While either a “too hot” or “too cold” jobs figure is often sufficient to spark a market selloff, the biggest danger on Friday is firmly tilted toward a stronger-than-expected reading, he said.

“Investors are on edge the Fed may delay rate cuts from June until later in the summer (or late in 2024) if we get another hot employment report,” Essaye wrote. “If that occurs, expect a partial repeat of Tuesday,” when the Dow Jones Industrial Average fell nearly 400 points, or 1%, for its worst performance since March 5, while the S&P 500 lost 0.7% and the Nasdaq Composite declined 1%.

Also, click here to view the full MarketWatch article published on April 4th, 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.

The initial market reaction to the CPI release was a hawkish one

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Oil prices decline to session lows: Sevens Report Co-Editor, Tyler Richey, Quoted in MarketWatch

Oil futures move up after CPI data, OPEC’s latest forecast for growth in oil demand

The initial market reaction to the CPI release was “a hawkish one, which saw oil prices decline to session lows,” said Tyler Richey, co-editor at Sevens Report Research. “Hawkish central bank policy is bad for the oil market because high interest rates over time act as a steady headwind on global growth and ultimately that weighs on consumer demand expectations.”

Looking at the reaction in the rates markets, “hawkish money flows were only modest, and investors are still pricing in a June rate cut from the Fed, just with a slight dip in confidence,” Richey said.

Also, click here to view the full MarketWatch article published on March 12th, 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.

Expectations of a “higher-for longer” policy by the Federal Reserve

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Expectations of a “higher-for longer” policy by the Federal Reserve: Tyler Richey Quoted in Morningstar

U.S. oil prices stretch gains into a sixth straight session

Expectations of a “higher-for longer” policy by the Federal Reserve are weighing on the demand outlook and have therefore acted as a headwind for U.S. benchmark oil prices recently, Tyler Richey, co-editor at Sevens Report Research, told MarketWatch.

However, Monday’s New York Fed Consumer Survey data showed a drop from 2.6% to 2.4% in the three-year inflation outlook, which was “received as dovish by the markets and helped support the domestic oil market to start the week,” Richey said.

On Tuesday, focus will shift to the U.S. CPI report, he said. A “hot” print would once again be a “headwind for oil prices, while a favorably ‘cool’ print could send WTI futures beyond $80” a barrel for the first time in 2024.

Also, click here to view the full MarketWatch article published on Morningstar on February 12th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Oil Inventories

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.

The Oil Market Has Seemed Skeptical

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The Oil Market Has Seemed Skeptical: Tyler Richey Quoted in Morningstar

Oil prices finish higher as traders weighs risks tied to U.S. airstrikes

The oil market has “seemed skeptical of the potentially positive demand implications of the recent string of strong economic data,” though prices did move up in the wake of the better-than-expected ISM report, Tyler Richey, co-editor of Sevens Report Research, told MarketWatch.

As far as what to watch for this week, Richey said a rise in consumer demand for refined products metrics in the weekly Energy Information Administration report due out Wednesday would be a bullish development, while a return to record U.S. oil output would be “negative for prices in the near term.”

Also, click here to view the full MarketWatch article published on Morningstar on February 5th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Oil Inventories

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.

The OPEC+ Decision Was A Clear Disappointment

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The OPEC+ Decision Was A Clear Disappointment: Tyler Richey Quoted in Morningstar

Oil prices stretch loss to a 4th session in a row to settle at lowest since July

“The OPEC+ decision was a clear disappointment last week due to both the underwhelming amount of additional [oil] output curbs and the voluntary nature of the 2024 policy cuts,” said Tyler Richey, co-editor at Sevens Report Research.

“The market didn’t buy it, however, as the bears are pressing OPEC+ for more clarity on the long-term outlook for policy plans and reassurance that the group is willing to do ‘whatever it takes’ to keep oil near or above $80/barrel,” Richey told MarketWatch on Tuesday.

“Looking ahead, the price action in oil has become increasingly heavy, and if there is not some sort of positive or bullish market catalyst ahead, we are likely to see a test of the 2023 lows in the $67/barrel area” for WTI, analysts at Sevens Report Research wrote in a Tuesday note.

Also, click here to view the full MarketWatch article published on Morningstar on December 5th, 2023. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Oil Inventories

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.

Stock Rally, 1o-Yr Treasury Yield, and Fed Policy

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Stock Rally, Treasury Yield, and Fed Policy: Tom Essaye Quoted in MarketWatch on MSN

Dow ends nearly 400 points higher as tech rally leads stocks to highest close since September

But the subsequent rally for stocks after the Nov. 1 Fed meeting, with the S&P 500 jumping more than 6% over eight days, and a 50 basis point drop in the 10-year Treasury yield were “overdone and not governed by facts,” said Tom Essaye, founder of Sevens Report Research, in a note.
“Meanwhile, if we think about what the Fed said last week, namely that the rise in the 10-year treasury yield was doing the Fed’s work for it and as a result they may not have to hike rates, then the short/sharp decline in the 10-year yield we’ve seen could essentially remove the reason for the Fed not having to hike rates — and that could put a rate hike back on the table!” he wrote. “That’s essentially what Powell reminded us of yesterday and that, along with the poor Treasury auction, pushed yields higher,” setting up pressure on stocks.

Also, click here to view the full article published by MSN on November 11th, 2023. However, to see the Sevens Report’s full comments on the current market environment sign up here.

Treasury Yield

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 Israel-Hamas Conflict in the Middle East

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The Israel-Hamas conflict in the Middle East: Tyler Richey Quoted in MorningStar

Oil prices inch higher after losing much of their war premium during a 3-session decline

“The Israel-Hamas conflict in the Middle East remains top of mind and the threat to the regions oil resources and infrastructure continue to warrant a fear bid in the oil market,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch.

However, “the lack of material escalation since the initial attacks by Hamas has seen some of that fear bid unwind as the conflict has been largely contained up to this point,” he said.

All of that “suggests an invasion is still imminent — just not right at this moment,” said Richey.

Also, click here to view the full MorningStar article published on October 25th, 2023. 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 Rally

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.

Tom Essaye Quoted in MaketWatch on August 14th, 2023

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China-focused ETFs drop as country’s property woes highlight ‘recession risks in China are real’

Concerns about China’s economy increased Monday after Country Garden Holdings Co. suspended trading in some offshore bonds, “reminding investors of Chinese property market volatility from years ago and reinforcing that recession risks in China are real,” Tom Essaye, founder and president of Sevens Report Research, said in a note. He also cited “downbeat trade data out of China” last week, with imports and exports both missing estimates.

Click here to read the full article.

Sevens Report Co-Editor, Tyler Richey, Quoted in Market Watch on July 31st, 2023

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Stocks could sink into a bear-market recession, says technician. Here are five signals on when it likely starts.

“We continue to respect the rally and acknowledge the trend in equities is still higher, but we remain ‘patient bears’ with regard to stocks given the deeply inverted yield curve,” Tyler Richey, co-editor at Sevens Report Research wrote in a Monday report.

“We view the fact that most Treasury spreads have inverted to levels not seen since the early 1980s as a clear warning sign that the more than 500 basis points of Fed rate hikes in less than 18 months was way too much for the economy to weather,” noted Richey. 

Click here to read the full article.

Sevens Report Analysts Quoted in Morningstar on July 20th, 2023

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Natural-gas futures settle nearly 6% higher; oil gains

Oil prices, meanwhile, finished higher. Global demand and supply will determine if WTI crude can “trade sustainably” above $80 a barrel in the near term, analysts at Sevens Report Research wrote in Thursday’s newsletter. Click here to read the full article.