Unseasonably cold temperatures are driving elevated spring heating demand in the U.S. amid an already bullish fundamental backdrop of subdued inventory levels and no real signs of rising production in the near to medium term…said Tyler Richey, co-editor at Sevens Report Research. Click here to read the full article.
Additionally, a geopolitical fear bid remains in the market and demand is expected to remain elevated leaving the path of least resistance decidedly higher with a medium-term upside target of $9.06…analysts at Sevens Report Research said in Monday’s newsletter, MarketWatch reports. Click here to read the full article.
U.S. natural-gas supplies are tight, sitting 23.9% below where they were last year and 17.8% below the five-year average…analysts at Sevens Report Research wrote in Monday’s newsletter. Click here to read the full article.
Looking at the yield curve, the 10s-2s spread continued to widen out and is now smack in the middle of the 30-40 basis point resistance range, and we think that’s a critical resistance level…said Tom Essaye, founder of Sevens Report Research, in a note. Click here to read the full article.
What’s in Today’s Report:
Futures declined overnight as NFLX dropped sharply on disappointing earnings (specifically declining subscribers) but a pullback in yields has helped the market stabilize in early morning trade.
Economically, German PPI was the latest hot inflation print as the headline spiked 4.9% vs. (E) 2.3% M/M.
Looking into today’s session, there is a slew of potential catalysts for the market beginning with another report on the housing market: Existing Home Sales (E: 5.86M) and then a busy Fed speaker circuit with: Daly (10:30 a.m. ET), Evans (11:30 a.m. ET), and Bostic (1:00 p.m. ET) all scheduled to speak.
There is also a 20-Yr Treasury Bond auction at 1:00 p.m. ET that could move yields and impact equity markets.
Finally, earnings season continues today with: PG ($1.29) ahead of the bell and TSLA ($2.27), UAL (-$4.15), AA ($2.99), and CSX ($0.38) due to report after the close.
Banks only do that when they think that default rates, which are currently low, will start to rise…wrote Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
We do see them [commodities] as stretched in the short term… said Tom Essaye, founder of Sevens Report Research. Click here to read the full article.
What’s in Today’s Report:
Futures are little changed following a quiet night of news and ahead of the long weekend.
There were no notable economic reports overnight. Geopolitically, the Russia/Ukraine war raged on as fighting intensifies in eastern Ukraine (as has been expected).
Earnings overnight were net positive as Taiwan Semiconductor (TSM) provided solid guidance and that’s helping to relieve some ongoing semiconductor supply anxiety.
Today will be a busy day, with the first potentially big event being the ECB Decision at 7:45 a.m. ET. No change is expected to rates or QE, but if Lagarde is hawkish in her commentary it could hit stocks.
Economically, we’ll have multiple reports today including, in order of importance, Retails Sales (E: 0.6%), Consumer Sentiment (E: 58.8), and Jobless Claims (E: 175K). As has been the case, markets will want to see continued stability in the data.
Finally, we have two Fed speakers, Mester (2:30 p.m. ET) and Harker (6:00 p.m. ET), but they shouldn’t move markets.
What’s in Today’s Report:
Futures are slightly higher mostly on momentum from Thursday’s close, following a quiet night of news.
The global trend in central banks turning more hawkish continued overnight as the Reserve Bank of India left rates unchanged (as expected) but warned that inflation was too high.
Geopolitically, a Kremlin spokesman said that Russia hoped to end its “operation” in Ukraine in the coming days or weeks, although analysts are skeptical of the promise.
Today there are no notable economic reports nor any Fed speakers, so between the sparse calendar and the Masters, I’d expect a relatively slow day. That said, if we get any geo-political headlines from Russia that imply a sooner than expected cease-fire, then stocks can extend Thursday’s rally.
Stocks are vulnerable to disappointment once again given the recent rally, so any deterioration in the Russia/Ukraine situation, spike in oil and hints of stagflation (high inflation/lagging growth) will hit stocks, and a 10% air pocket shouldn’t shock anyone…Tom Essaye, a former Merrill Lynch trader who founded The Sevens Report newsletter, said in a note. Click here to read the full article.
