However, from a fundamental standpoint, any production cuts would be aimed at offsetting the return of Iranian barrels to the global market and not a material new bullish catalyst…said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are solidly higher following better-than-expected economic data and as markets continue to recoup Monday’s declines ahead of the Powell speech tomorrow.
Economic data was better than expected overnight as German GDP beat estimates (1.8% vs. (E) 1.4%) as did the IFO Business Expectations survey (80.3 vs. (E) 78.8).
On the Fed front, Bostic said the September rate hike was a 50/50 proposition between 50 bps or 75 bps, and that’s largely in line with market expectations.
Today’s focus will be on economic data via Jobless Claims (E: 255k) and Revised Q2 GDP (E: -0.9%) and markets will want to see a continued slow rise in jobless claims and a stable GDP report (so not materially worse than expected).
Additionally, while the official Fed speaker calendar doesn’t have any events today, we should prepare for a deluge of Fed commentary via the financial media (CNBC, FT, WSJ, Marketwatch, etc.) as the Jackson Hole conference begins. Barring any major surprise commentary, though, markets should look past Fed speak today and focus on Powell’s speech tomorrow.
What’s in Today’s Report:
Stock futures are flat and international markets were little changed overnight as currency and bond markets continued to stabilize with the focus remaining on the Jackson Hole Economic Symposium later in the week.
There were no notable economic reports overnight.
Today, no Fed officials are scheduled to speak leaving the focus on economic data early with Durable Goods Orders (E: 0.5%) and Pending Home Sales (E -2.5%) both due out early in the day.
Beyond those economic reports, there is a 5-Yr Treasury Note auction at 1:00 p.m. ET, and if it is as soft as yesterday’s 2-Yr Note auction, that could result in rising yields which would in turn weigh on stocks ahead of Jackson Hole. However, barring any meaningful moves in the currency and bond markets today, it should be relatively quiet as traders begin to position into Powell’s speech on Friday morning.
What’s in Today’s Report:
Futures are slightly higher on better-than-expected earnings, following an otherwise quiet night of news.
Cisco (CSCO) posted strong earnings and gave positive commentary on tech demand going forward.
Economically, EU HICP (their CPI) met expectations at 8.9% yoy and that reading means a 50 bps rate hike from the ECB is still likely in September.
Today’s focus will be on economic data, specifically the Philadelphia Fed Manufacturing Survey (E: -5.0). If Philly Fed echoes the weak Empire Manufacturing reading and the price indices don’t decline, we’ll see stagflation concerns rise. Other reports today include Jobless Claims (E: 265K) and Existing Home Sales (E: 4.85M) but neither should move markets.
We also get two Fed speakers, George (1:20 p.m. ET) and Kashkari (1:45 p.m. ET), and the market will be looking for any insight on a 50 bps vs. 75 bps hike in September (markets are expecting 50 bps).
For oil’s drop, it’s mostly a demand story. If you see oil move into the high to mid 70s, people are going rethink the idea that these companies are cash flow-generating machines, Essaye said. Click here to read the full article.
Demand concerns are now the dominant influence on the global energy market and even though supply worries will persist with the Russia-Ukraine war, we will need to see evidence of demand stabilizing for the oil market to begin to find a near-term bottom,” analysts at Sevens Report Research wrote. Click here to read the full article.
Demand concerns are now the dominant influence on the global energy market and even though supply worries will persist with the Russia-Ukraine war, we will need to see evidence of demand stabilizing for the oil market to begin to find a near-term bottom,” wrote analysts at Sevens Report Research, in a note. Click here to read the full article.
What’s in Today’s Report:
Stock futures are trading cautiously higher this morning as geopolitical angst is easing after Pelosi’s departure from Taiwan while economic data was mostly positive overnight.
Chinese and EU Composite PMIs for July topped estimates while Eurozone PPI was no worse than feared and that data is helping some of the hawkish fears from Tuesday unwind.
Looking into today’s session, earnings season is beginning to wind down but there are still a few notable reports due out today: MRNA ($4.50), CVS ($2.16), YUM ($1.08), HOOD (-$0.36), EBAY ($0.89), and MGM ($0.24).
However, the market’s main focus will be on economic data today with ISM Services Index (E: 53.0) and Factory Orders (E: 1.1%) both due out shortly after the open while there is one Fed speaker: Harker (10:30 a.m. ET).
Investors will want to see still solid growth numbers in the data, further easing in inflation readings, and hopefully a less hawkish tone out of the Fed if the July relief rally is going to extend into August.
What’s in Today’s Report:
Stock futures are lower and the 10-year yield fell to a 4-month low overnight amid heightened tensions between the U.S. and China over Speaker Pelosi’s trip to Taiwan.
Speaker Pelosi is scheduled to land in Taiwan later this morning despite repeated and stern warnings from China about a potential military response to the visit and the elevated tensions are resulting in equity market weakness and rising demand for safe havens assets such as Treasuries.
Looking beyond geopolitics, there are a few other potential catalysts to watch today including two economic reports: Motor Vehicle Sales (E: 13.5M) and JOLTS (11.0M), as well as two Fed officials scheduled to speak: Evans (9:00 a.m. ET) and Bullard (6:45 p.m. ET).
Earnings season also continues today with results from CAT ($3.00), JBLU (-$0.11), MAR ($1.59), TSEM ($0.52), AMD ($1.03), PYPL ($0.85), and SBUX ($0.77).
Bottom line, markets are trading with a risk-off tone due to the U.S.-China tensions surrounding Taiwan however a meaningful escalation including military action between the U.S. and China remains very unlikely, and as such the pressure on equities is not expected to deepen or last very long and market focus is likely to turn back to Fed policy later in the week as the July jobs report is due out on Friday.
Our technical view of oil has now shifted from cautiously bullish to neutral with rising risks to the downside, especially after WTI closed below that aforementioned support at the March and April double bottom lows ($95.18) for a second time in a week yesterday. Wrote analysts at Sevens Report Research, in a note. Click here to read the full article.
