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What the Trump Victory Means for Markets

What the Trump Victory Means for Markets: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • What the Trump Victory (and likely Republican Sweep) Means for Markets

Futures are surging more than 2% as Donald Trump soundly defeated Kamala Harris, Republicans flipped the Senate and will likely win the House of Representatives, completing the sweep and taking control of Washington.

Markets are moving sharply on the expected Republican sweep, as the Dollar Index is 1.7% higher, the 10-year Treasury yield jumps 17 bps and oil falls more than 1%.

Away from the U.S., German Manufacturers’ Orders and Euro Zone Composite PMIs were stronger than expected.

Today most of the analysis and commentary will focus on the implications of the likely Republican sweep, but there is also an important economic report out this morning: the November Flash Composite PMI (E: 54.3).  That number needs to stay Goldilocks to keep growth and Fed rate cut expectations intact (and now that the election is behind us, those growth and rate cuts will again drive markets).


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How to Explain This Market To Clients (September Update)

How to Explain This Market To Clients: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • How to Explain This Market To Clients (September Update)
  • Weekly Market Preview:  Two Key Central Bank Decisions (Fed on Wednesday, BOJ on Thursday)
  • Weekly Economic Cheat Sheet:  Important Growth Updates This Week

Futures are little changed despite more negative Chinese economic data as investors look ahead to the Fed decision on Wednesday.

August Chinese economic data disappointed as Industrial Production (4.5% vs. (E) 4.7% and Retail Sales (2.1% vs. (E) 2.7%) both missed estimates, raising more concerns about Chinese growth (and global growth more broadly).

Politically, there was another assassination attempt on Trump, although the event shouldn’t alter the current race.

This week will be both busy and important for this rally, but it starts slowly as the only notable number today is the September Empire Manufacturing Index (-4.1).  An in-line to slightly better than expected number would be the best-case scenario for markets today.


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Is Oil’s Collapse an Anecdotal Warning Sign?

Is Oil’s Collapse an Anecdotal Warning Sign? Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • More Problems With Expectations (This Time Companies)
  • Is Oil’s Collapse an Anecdotal Warning Sign?

Futures are tracking most overseas equity markets lower as investors assess global growth concerns and look ahead to today’s critical U.S. inflation data.

Economically, U.K. data was weak as monthly GDP fell to 0.5% vs. (E) 0.6%, Industrial Production was down -0.8% vs. (E) +0.2% and monthly trade data showed both imports and exports slowed -4.6% and -10.8%, respectively in July.

Looking ahead to today’s session, the most important potential market catalyst is U.S. inflation data: CPI (E: 0.2% m/m, 2.6% y/y) and Core CPI (E: 0.2% m/m, 3.2% y/y). A “cool” CPI report should bolster hopes for a 50 bp rate cut next week, and in turn, support stocks while a “hot” print could pour cold water on this week’s tentative rebound in equity markets.

There are no Fed officials scheduled to speak today however there is a 10-Yr Treasury Note auction at 1:00 p.m. ET that could shed additional light on investor expectations for inflation, growth, and Fed policy going forward. A weak auction outcome would be negative for stocks while solid demand for the 10-Yr Notes should support a continuation of this week’s rally.


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Market Multiple Table: Still Overvalued

Market Multiple Table: Still Overvalued: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • September Market Multiple Table Update: Still Overvalued
  • Chart – Oil Falls to 52-Week Lows on Demand Worries

Futures are modestly lower this morning as last week’s volatility and yesterday’s relief rally are digested by investors while focus is shifting to tomorrow’s CPI release.

Economically, the NFIB Small Business Optimism Index whiffed estimates of 93.6 and fell 2.5 points to 91.2 in August while German CPI met estimates at 1.9% y/y.

Looking into today’s session, there are no notable economic reports on the calendar, but two Fed officials are scheduled to speak: Barr (10:00 a.m. ET) and Bowman (12:15 p.m. ET). It is unlikely that either move markets though.

Finally, in the afternoon, the Treasury will hold a 3-Yr Note auction at 1:00 p.m. ET. If demand for the Notes is weak it could spark hawkish money flows while an auction outcome too-strong could reignite recession worries in afternoon trade.

Bottom line, more “wait-and-see” trading is most likely for today’s session as traders await the latest inflation data which has the potential to shift Fed policy expectations (25 bop or 50 bp Fed rate cut) ahead of next week’s meeting.


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An economic downturn resulting from a ‘Fed mistake’

An economic downturn resulting from a ‘Fed mistake’: Tyler Richey, co-editor at Sevens Report Research


WTI Extends Losses After API Reports Small (Surprise) Crude Build

“An economic downturn resulting from a ‘Fed mistake’ would lead to a bear market in the global energy markets,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch.

So “if we start to see economic data deteriorate in the coming weeks or months, demand estimates penciled in based on the optimistic hope of a soft landing will fall considerably amid an emerging recessionary reality.”

Also, click here to view the full ZeroHedge article published on August 20th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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.

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I continue to advocate for defensive sector exposure and and minimum volatility funds

 I continue to advocate for defensive sector exposure and and minimum volatility funds: Tom Essaye Quoted in SwissInfo.ch


Stocks Halt Rebound as Oil Hits $80 on War Angst: Markets Wrap

Tom Essaye at The Sevens Report says he doesn’t think fundamentals have deteriorated enough to warrant de-risking and reducing equity or risk exposure — but he also wants to caution against dismissing the recent uptick in volatility.

“Much of what I read over the weekend characterized this recent volatility as just a typical pullback in an upward-trending market,” Essaye. “Because of that, I continue to advocate for defensive sector exposure and and minimum volatility funds.”

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

Swissinfoch logo

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.


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A geopolitical fear bid in the oil market

A geopolitical fear bid in the oil market: Sevens Report Co-Editor, Tyler Richey, Quoted in Morningstar


Oil prices lifted as data shows drop in U.S. crude inventories

Oil has “benefited from some of the risk-on money flows in other asset classes, most notably stocks, as well as still-elevated tensions between Israel and regional enemies Hamas and Hezbollah, keeping a geopolitical fear bid in the market,” wrote analysts at Sevens Report Research in a note.

Also, click here to view the full MarketWatch article published on Morningstar on August 7th, 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.


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The biggest question facing investors today remains ‘Is It Different This Time?

The biggest question facing investors today remains ‘Is It Different This Time?: Sevens Report Editor, Tom Essaye, Quoted in Barron’s


The Stock Market Doesn’t Look Like the Dot-Com Bubble. It’s Something Worse.

No, that’s not the real worry. The S&P 500 is. It smacks of 2007 all over again. From last July until now, the index has traded with an 85% correlation to July 2006 though July 2007, according to Sevens Report’s Tom Essaye.

Essaye went so far as to describe the resemblance of this market to the 2007 market as “concerning to say the least.” And he touched on the uncertainty that investors are facing.

“The biggest question facing investors today remains ‘Is It Different This Time?’” he wrote

Also, click here to view the full Barron’s article published on July 31st, 2024. 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 RallyIf 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.

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Oil futures appropriately popped in the wake of the release

 Oil futures appropriately popped in the wake of the release: Sevens Report Co-Editor, Tyler Richey, Quoted in Morningstar


Oil prices climb as U.S. data show crude supplies down a fourth straight week

Wednesday’s EIA report was “solid and oil futures appropriately popped in the wake of the release,” said Tyler Richey, co-editor at Sevens Report Research.

Still, the “trend of strong consumer demand has faltered in July,” underscored by the fact the four-week moving average of gasoline supplied remains about 30,000 barrels per day off the early July year-to-date highs, he told MarketWatch.

Going forward, the “energy bulls will want to see more evidence of strong and persistent consumer demand in order for oil to hold above key technical support at $76.50 because recession worries are on the rise and volatility is picking up, both of which are typically headwinds for the price of oil,” said Richey.

Also, click here to view the full MarketWatch article published on Morningstar on July 24th, 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 Important Question in a Noisy Market

The Important Question in a Noisy Market: Start a free trial of The Sevens Report.


What’s in Today’s Report:

  • The Important Question in a Noisy Market

Futures are slightly higher mostly on momentum as markets again ignore disappointing retailer earnings.

Hugo Boss became the latest retailer to post poor results and cut guidance as anecdotal warnings on consumer spending continue to grow.

The only notable economic number overnight was the German ZEW Sentiment Index and it met expectations.

Today focus will stay on economic data and earnings. The key economic report today (and of the week) is Retail Sales (E: -0.3%) and if that number is weaker than expected, look for concerns about a slowdown to grow (although that likely won’t hit stocks immediately as bad data is still good for stocks).  We also get the Housing Market Index (E: 43) and one Fed speaker, Kugler (2:45 p.m. ET), but they shouldn’t move markets.

On the earnings front the season continues to heat up and reports we’ll be watching today include:  BAC ($0.79), UNH ($6.65) and MS ($1.65).


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