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The key parts of the release will be one and five-year inflation expectations

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The key parts of the release will be one and five-year inflation expectations: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

Dow Opens Higher, Extending Winning Streak

Aside from the Fed speakers, traders will get an update on consumer sentiment from the University of Michigan. Sevens Report Research’s Tom Essaye writes that the key parts of the release will be one-year inflation expectations and five-year inflation expectations.

“If both of those numbers are higher than expected, it’ll be another negative signal on inflation and don’t be surprised if Treasury yields rise in response to them and stocks give back these early gains,” Essaye writes.

Also, click here to view the full Barron’s article published on May 10th, 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.

To strengthen your market knowledge take a free trial of The Sevens Report.

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The latest data point to offer a whiff of stagflation

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The latest data point to offer a whiff of stagflation: Sevens Report Co-Editor, Tyler Richey, Quoted in MarketWatch

Oil prices head lower, paring gains for the week

The U.S. consumer sentiment report was the latest data point to “offer a whiff of stagflation,” said Tyler Richey, co-editor at Sevens Report Research. “Risk assets didn’t like that,” and oil prices moved down toward session lows shortly after the data’s release.

“The geopolitical fear bid has largely gone stale since the realized impact of the ongoing Israel-Hamas war has been nominal compared to the implied threat to global oil supply when the conflict began last fall,” he told MarketWatch.

Also, click here to view the full MarketWatch article published on May 10th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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.

A high-frequency proxy for consumer spending

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A high-frequency proxy for consumer spending: Sevens Report Co-Editor, Tyler Richey, Quoted in MarketWatch

Recession-wary investors are watching gasoline demand for clues to consumer health

“Gasoline demand is being closely watched as a high-frequency proxy for consumer spending,” said Tyler Richey, co-editor at Sevens Report Research.

“Keeping an eye on the weekly gasoline supplied figure as a proxy for consumer demand for gasoline will be critical, especially relative to its four-week moving average to gauge the underlying trend in fuel demand, and compared with prior year’s levels for the corresponding reporting week,” Richey said.

Also, click here to view the full MarketWatch article published on May 9th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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.

Are Stagflation Risks Real?

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Are Stagflation Risks Real? Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Are Stagflation Risks Real?
  • Weekly Market Preview:  If Treasury Yields Rebound, Will That Hit Stocks?
  • Weekly Economic Cheat Sheet:  CPI on Wednesday, Important Growth Data Throughout the Week

Futures are slightly higher following a very quiet weekend of news as investors look ahead to a potentially very important week that includes Wednesday’s CPI report.

China announced plans to sell $140 billion in long term bonds to fund more economic stimulus, which will help combat recession fears in that economy.

There was no notable economic data out over the weekend.

Today focus will be on the New York Fed One Year Inflation Expectations (3.0%).  If they run hot like we saw in Friday’s University of Michigan Inflation Expectations, Treasury yields should rise and pressure stocks.  Outside of that data, we also have two Fed speakers, Jefferson & Mester (9:00 a.m. ET), but they shouldn’t move markets unless they talk about rate hikes.

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Is Gasoline Demand Another Economic Warning Sign?

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Is Gasoline Demand Another Economic Warning Sign? Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • Is Gasoline Demand Another Economic Warning Sign?
  • Did Earnings Season Change the Market Outlook?

Futures are solidly higher thanks to continued momentum from Thursday’s rally following a quiet night of news.

Economically, UK data was stronger than expected (GDP and Industrial Production beat estimates) but it’s not changing BOE June rate cut assumptions.

Today there is just one notable economic report, the University of Michigan Consumer Sentiment Index (E: 77.0) and the key parts of that release will be the 1-Yr Inflation Expectations (E: 3.2%) and the 5-Yr. Inflation Expectations (E: 3.0%).  If both of those numbers are higher than expected, it’ll be another negative signal on inflation and don’t be surprised if Treasury yields rise in response to them and stocks give back these early gains.

In addition to that one economic report, we also get numerous Fed speakers today including: Bowman (9:00 a.m. ET), Logan (10:00 a.m. ET), Kashkari (10:00 a.m. ET), Goolsbee (12:45 p.m. ET) and Barr (1:30 p.m. ET).  However, unless one of them explicitly advocates for rate hikes, they shouldn’t move markets.

Join thousands 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.

There are only really three important weeks of earnings season

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There are only really three important weeks of earnings season: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

Dow, S&P 500 Tick Higher

“There are only really three important weeks of earnings season, and Disney comes the week after it,” Sevens Report Research’s Tom Essaye told Barron’s. “It sort of puts a bow on earnings season, but it’s not like Disney is really that representative of the broader economy.”

“The global market has convinced themselves that that the [European Central Bank] and the BOE are going to cut in June,” Essaye says. “And if the Bank of England pushes back on that, I think could be a little bit of a negative surprise.”

Also, click here to view the full Barron’s article published on May 7th, 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.

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.

Things aren’t as bad as people were afraid of

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Things aren’t as bad as people were afraid of: Sevens Report Editor, Tom Essaye, Quoted in Barron’s

S&P 500 Holds Above Its 50-Day Moving Average

“The bottom line is that things aren’t as bad as people were afraid of about 10 days ago, and now the market is rallying, now it’s making some technical progress getting back above the 50, and that’s just going to create more chasing, more fear of missing out,” Essaye says. “And I think that’s really what’s helping the market these last couple of days.”

“Until something happens to kind of break this little conversation that investors are having with each other where they’re convincing themselves of these things, the market can rally,” Essaye says. “And there’s not a ton on the calendar this week to break that idea.”

Also, click here to view the full Barron’s article published on May 7th, 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.

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.

What Are The GRANOLAS and Why Are They Attractive?

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What Are The GRANOLAS and Why Are They Attractive? Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • What Are The GRANOLAS and Why Are They Attractive?
  • EIA Analysis and Oil Market Update

Futures are modestly weaker following a quiet night of news as investors digest the last weeks’ gains.

Economically, Chinese exports (1.5% vs. (E) 1.3%) and imports (8.4% vs. (E) 4.7%) were stronger than expected, offering some optimism for that economy.

Tech earnings continued to be mixed as semiconductor company ARM Holdings (ARM) posted soft guidance and the stock is down 8% pre-market.

Today focus initially will be on the BOE Rate Decision, as no rate cut is expected but the BOE may signal a rate cut is coming in June.  In the U.S., the only notable number is Jobless Claims (E: 212K) and there’s just one Fed speaker today (Daly at 2:00 p.m. ET) and it’ll take a significant surprise from either event to move markets.

Join thousands 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.

An S&P 500 Priced for Perfection: May MMT Chart

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An S&P 500 Priced for Perfection: May MMT Chart: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • May MMT Chart: An S&P 500 Priced for Perfection
  • Manheim Used Vehicle Value Index Raises Questions About Growth

Futures are flat as disappointing earnings in Asia (Toyota and Nintendo) were largely offset by solid guidance from AB InBev and Siemens Energy in Europe while macroeconomic news wires were relatively quiet.

Economically, exports from Taiwan plunged to 4.3% y/y in April from 18.9% in March due to weak Chinese demand but exports to the U.S. hit a record amid strong AI demand. The soft Chinese demand is a concern, but AI optimism is for now offsetting those worries.

There are no notable economic reports today leaving focus on the Fed speaker circuit with Jefferson (11:00 a.m. ET), Collins (11:45 a.m. ET) and Cook (1:30 p.m. ET) all scheduled to speak.

Additionally, there is a 10-Yr Treasury Note auction at 1:00 p.m. ET. Yesterday’s 3-Yr Note auction saw decent demand but if today’s longer duration Note auction is soft, that will put upward pressure on yields and weigh on equity markets as this relief rally has begun to lose momentum.

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May MMT Update: Less Bad News Is Not Good

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May MMT Update: Less Bad News Is Not Good: Start a free trial of The Sevens Report.

What’s in Today’s Report:

  • May Market Multiple Table Update: Don’t Confuse Less-Bad News for Actual Good News

Futures are little changed this morning as favorable EU economic data and strong bank earnings from UBS and UniCredit offset escalating geopolitical tensions in Gaza.

Geopolitically, Israeli tank units seized a critical Rafah border crossing with Egypt as ceasefire talks reportedly continue, however the market impact is limited this morning with oil futures slightly lower.

Economically, UK’s Construction PMI topped estimates (53.0 vs. E: 51.1) and EU Retail Sales rose 0.8% vs. (E) 0.7% helping ease worries about fading economic growth in Europe.

Looking into today’s session, focus will be on the Fed’s Kashkari who speaks mid-morning (11:30 a.m. ET). The market is looking for more confirmation of sooner-than-later rate hikes in 2024.

Then this afternoon, there is a 3-Yr Treasury Note auction at 1:00 p.m. ET which will be closely watched by bond traders to see how well the larger than expected Q2 bond issuance will be absorbed by the market. A tailing auction that sends yields higher will be negative for stocks.

Finally, there is just one economic report this afternoon: Consumer Credit ($15.5B) and two earnings reports to watch: DIS ($1.11), LYFT ($0.02).

Join thousands 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.