When we start to see broader delta fears being to subside…we should see that metric ramp back up and underscore…analysts at Sevens Report Research wrote in Thursday’s newsletter. Click here to read the full article.
July was certainly a rollercoaster in the oil markets, said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately higher thanks to solid economic data and better than expected earnings.
The EU flash PMI was stronger than expected at 60.6 vs. (E) 60.0, while good UK Retail Sales (0.5% vs. (E) 0.4%) helped offset the soft UK flash PMI (57.7 vs. (E) 61.9). But, on an absolute basis the numbers were good, and importantly the economic recovery is still on going and has good momentum.
Earnings were good in aggregate overnight with strong reports from TWTR and SNAP, among others.
Today the key number will be the July Flash Composite PMI (E: 63.4) and markets will want “Goldlocks” data. Specifically, that means strong activity that implies the rise in COVID cases isn’t hurting the recovery, while at the same time, activity that isn’t so strong it makes the Fed think about tapering sooner than expected, or more forcefully.
Earnings season also continues today, and four reports we’ll be watching include: NEE ($0.67), AXP ($1.64), SLB ($0.25), and HON ($1.94).
What’s in Today’s Report:
U.S equity futures are rebounding with European shares this morning while bond yields are rising from multi-month lows as investors digest a volatile week amid economic uncertainty and renewed COVID-19 concerns.
Economically, Chinese inflation data was “cooler” than expected with June CPI falling from 1.3% to 1.1% vs. (E) 1.4%, helping solidify the idea that inflation has peaked.
Looking ahead to today’s session, the calendar is quiet as there are no notable economic reports and no Fed officials are scheduled to speak.
That will likely leave investors to focus on any developments regarding the Delta variant of COVID-19 and any subsequent lockdown measures as well as price action in the bond market. As long as coronavirus headlines are not materially negative and bond yields extend this morning’s bounce, stocks should be able to claw back more of yesterday’s losses.
What’s in Today’s Report:
Futures are slightly higher ahead of the jobs report following a quiet night of news.
The only notable economic report overnight was Eurozone PPI, which rose 9.6% yoy vs. (E) 9.5% yoy. That report isn’t moving markets, but it’s the second inflation report in two days to imply inflation pressures haven’t peaked.
There were no new developments on infrastructure.
Today the jobs number is key and expectations are as follows: Job Adds 675K, UE Rate 5.7%, Wages yoy 3.1%. As long as the headline job adds number isn’t close to 1 million and the wages number doesn’t spike well above expectations, markets should be able to generally digest this report, even if it is a mild surprise.
Other economic indicators today include International Trade in Goods (E: -$71.2B) and Factory Orders (E: 1.3%) but we don’t expect them to move markets.
What’s in Today’s Report:
Futures are slightly higher following a night of mixed economic data.
Global June manufacturing PMIs were mixed as the Japanese (52.4 vs. 53.0) and UK (63.9 vs. (E) 64.2) PMIs missed estimates, while the EU manufacturing PMI beat expectations (63.4 vs. (E) 63.1.).
The net impact of the data is to show the global recovery is on going, but also that it has lost a bit of momentum.
Today’s focus will be on economic data, with the two important reports being Jobless Claims (E: 387K) and the June ISM Manufacturing Index (E: 61.1). As has been the case, markets will want “Goldilocks” data to start the quarter, in that the numbers show solid activity, but nothing that would make the Fed taper more aggressively. There’s also one Fed speaker, Bostic at 2:00 p.m. ET, but he shouldn’t move markets.
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There’s a resurgence in COVID-19 fears as case counts are rising sharply in parts of Asia, while the ‘Delta variant’ of the virus is…said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
S&P futures are trading solidly higher this morning amid infrastructure deal optimism ahead of key data today.
Risk on money flows are being driven by reports that a roughly $1T-$1.2T infrastructure deal, that will not require changes to individual or corporate tax rates, is “imminent.”
This morning is lining up to be a busy one from a catalysts standpoint as there are several important economic reports to watch including: Durable Goods Orders (E: 2.0%), Final Q1 GDP (6.4%), International Trade in Goods (E: -$87.9B), and Jobless Claims (E: 380K).
Several Fed officials are also scheduled to speak: Williams (11:00 a.m. ET), Kaplan (1:00 p.m. ET), and Bullard (1:00 p.m. ET) while there is a 7-Yr Treasury Note auction at 1:00 p.m. ET.
Bottom line, investors will want to see economic data remain strong today but importantly not run “too hot” as that could spark renewed hawkish concerns and weigh on broader equity markets as we saw last week. Additionally, Fed chatter can continue to lean hawkish but not so much that we see policy expectations turn more hawkish than the post-Fed reaction. Finally, today’s 7-Yr Treasury Note auction is the wildcard to watch as if it is a repeat of the February disaster, bond market volatility could spill over into equity markets.
The rise in the dollar was certainly a renewed headwind for oil and all commodities, prompting some cross-asset funds…said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
After nearly a year of anti-climactic FOMC meetings, tomorrow’s meeting has the potential to move markets because it…wrote Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter. Click here to read the full article.
