The market looks at that, and basically, the logic is, ‘oh crap, if they’re doing this then what about the ones aren’t as strong?’ And what are they seeing coming that everyone else isn’t…said Tom Essaye, president of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly higher as markets bounce from Friday’s declines, following a quiet weekend and as investors look forward to numerous important catalysts this week.
Chinese authorities are considering some restrictions on movement in Shanghai as COVID cases rise, but are still resisting broad lockdowns (for now).
Economically, German Ifo Business Expectations declined further (80.3 vs. (E) 83.3).
Today there’s only one notable economic report, the Chicago Fed National Activity Index (E: 0.05), and markets will want to see stability here following last week’s disappointing data. If this number is surprisingly weak (like the PMIs last Thursday/Friday) then that will likely weigh on stocks as recession fears grow.
Earnings season continues and this will be a very busy and important week for results. Some earnings we’ll be watching today include: WHR ($5.22), NXPI ($3.39), and LOGI ($3.39).
What’s in Today’s Report:
Stocks are resilient this morning as futures are only slightly lower despite disappointing overnight earnings and ugly economic reports from Europe.
Earnings overnight were bad with several ugly reports including SNAP (-30%), COF (-3.5%), and STX (-13%).
Economically, July flash PMIs from the EU were also ugly as the composite PMI fell into contraction territory at 49.6 vs. (E) 51.0.
Hope that inflation has peaked is the reason stocks are resilient lately, so today’s focus will be on the July Flash Manufacturing PMI (E: 51.8) and the July Flash Services PMI (E: 52.3). If these reports show meaningful drops in the price indices (like we’ve seen in the Empire and Philly Fed surveys) then that will further the idea that inflation is peaking and support stocks (as long as the headline readings aren’t huge misses).
On the earnings front, results to watch today include TWTR (-$0.06), VZ $1.34), and AXP ($2.37).
What’s in Today’s Report:
Stock futures are slightly higher this morning as yesterday’s sizeable rally is digested amid news that Russia will resume gas flows through the Nord Stream 1 pipeline this week.
Economically, German PPI came in below expectation but U.K CPI and PPI both came in slightly hot which is offering mixed signals regarding whether we have reached peak inflation not globally.
Looking into today’s session, we will get another report on the housing market: Existing Home Sales (E: 5.400M), and investors will again be looking for a less dismal print than Monday’s Housing Market Index release.
There are no Fed speakers today, but the Treasury will hold a 20-Yr Bond auction at 1:00 p.m. ET that could move yields and impact equity trading (especially if it sends yields meaningfully higher).
Finally, traders will remain focused on earnings with ABT ($1.07) and BIIB ($4.10) releasing results ahead of the bell and TSLA ($1.73), UAL ($1.86), CSX ($0.47), and DFS ($3.74) reporting after the close.
Bottom line, near-term market momentum has taken a decidedly bullish shift, and while we could see a modest pullback as yesterday’s outsized gains are digested further if news flow remains even slightly positive, the path of least resistance is still higher into the end of the week.
What’s in Today’s Report:
Futures are moderately higher mostly on momentum from Friday’s rally and following a generally quiet weekend.
Investors continue to hope for a near-term peak in inflation and Friday’s drop in University of Michigan inflation expectations (2.8% vs. (E) 3.0%) and multi-month lows in the Empire Manufacturing price indices fueled that hope and resulted in the rally on Friday and in futures this morning.
Today’s focus will shift to earnings, and they will dominate market action early this week as there are no Fed speakers and no market-moving economic reports till later this week. If earnings are better than feared, they can help extend this rally in the near term while disappointing results will cause more volatility. Some reports we’re watching today include BAC ($ 0.77), GS ($6.99), SCHW ($0.91), IBM ($ 2.29).
What’s in Today’s Report:
Futures are sharply lower as markets digest the hot CPI amidst numerous hawkish central bank decisions.
Global central banks are aggressively tightening policy and that was displayed yesterday and overnight as the Bank of Canada and the central banks of Singapore, Philippines, and, Chile all hiked more than expected.
Meanwhile, U.S. Fed Fund Futures are now pricing in a 100-bps hike in July.
Today we get two notable economic reports via Jobless Claims (E: 234K) and PPI (0.8% m/m, 10.4% y/y). Starting with PPI, if we see a big drop (which isn’t expected but possible) that will be a mild positive as PPI is sometimes a leading indicator for broader inflation. Jobless claims, meanwhile, should continue to tick higher towards 250k.
On the earnings front, Q2 earnings season unofficially kicks off today with results from JPM ($2.85) and MS ($1.55) and in addition to wanting to see earnings beats, markets will be looking for commentary from management on the state of the economy, and if that commentary is cautious it’ll be a headwind on stocks.
The widening spread between the 2-year and the 10-year is signaling a very clear recession warning, especially if it reaches 15 basis points…wrote Tom Essaye of The Sevens Report. Click here to read the full article.
Rising recession concerns in the EU…continue to drive the dollar relentlessly higher vs. the euro, pound, and yen…wrote Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
The key for tomorrow’s jobs report is that it furthers the idea that we’ve hit ‘peak hawkishness’ with the Fed and peak inflation…says Tom Essaye, editor of the Sevens Report. Click here to read the full article.
What’s in Today’s Report:
Futures are modestly lower following new COVID-related shutdowns in China.
Macau will close most businesses, including casinos, for one week following a COVID outbreak while Shanghai will continue with massive testing, in what is a signal that the “Zero COVID” policy is at least partially still in effect.
Geo-politically, Canada released a turbine to Gazprom (a Russian energy company) and the hope is that will result in increased natural gas flows to Europe in the coming weeks, putting more pressure on commodity prices.
Today there are no notable economic reports and just one Fed speaker, Williams at 2:00 p.m. ET. Futures are taking the new lockdowns in China somewhat in stride but if headlines imply anything like a repeat of the Shanghai lockdowns of March-May, expect stocks to drop as a result.