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Jobs Report Preview (Could It Make the Fed More Hawkish?)

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What’s in Today’s Report:

  • Jobs Report Preview – Could A “Too Hot” Report Make the Fed more Hawkish?
  • Oil Update and EIA Analysis

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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Tom Essaye Quoted in Barron’s on June 28, 2021

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Virgin Galactic Soars, Wix Falls, and Stocks Are Wavering

If their comments are more hawkish than expected it will be a…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.

What’s the State of Infrastructure?

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What’s in Today’s Report:

  • What’s the State of Infrastructure?

Stock futures are little changed near all-time highs in quiet trading this morning as concerns about the “Delta” variant of COVID-19 linger while investors look ahead to fresh economic data in the U.S.

Economically, Japanese Unemployment edged up to 3.0% in May from 2.8% in April but Retail Sales topped estimates while Eurozone June Economic Sentiment met expectations.

Looking into today’s session, there are two reports on real estate prices due this morning: Case-Shiller Home Price Index (E: 1.2%) and FHFA House Price Index (E: 1.0%), before the more important release on Consumer Confidence (E: 118.8) is due out shortly after the bell.

There is also one Fed officials scheduled to speak: Barkin (9:00 a.m. ET) but as long as there is not a notable hawkish shift in tone, the commentary should not impact stocks.

That will leave investors focused on any news or developments regarding the “Delta” variant of COVID-19, specifically if any government imposes new lockdowns as a result and infrastructure negotiations.

Four Pillars of the Rally Remain Intact

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What’s in Today’s Report:

  • Bottom Line – Four Pillars of the Rally Remain Intact
  • Weekly Economic Cheat Sheet – Flash PMIs and Core PCE in Focus

Stock futures are trading cautiously higher this morning while international equities were mixed overnight as markets attempt to stabilize following last week’s volatile, Fed-induced declines.

News flow was quiet over the weekend as there were no major economic releases or central bank developments however the yield curve remains in focus as several key spreads have flattened to multi-month lows on hawkish policy expectations and a more cautious growth outlook.

There are no notable economic reports and no Fed officials are scheduled to speak today.

The lack of market catalysts will leave investors to continue to digest last week’s Fed developments and closely monitor the bond markets for further clues on expectations for both monetary policy and the state of the economic recovery.

Tom Essaye Quoted in Barron’s on June 16, 2021

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Dish Network Is Gaining, GM Is Jumping and the Stock Market Has Stalled Ahead of the Fed

Stock futures are flat this morning as a sense of Fed paralysis grips global markets ahead of…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.

What the Fed Decision Means for Markets

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What’s in Today’s Report:

  • What the More Hawkish Than Expected Fed Decisions Means for Markets
  • EIA Analysis and Oil Market Update

Futures are modestly lower as markets digest yesterday’s more hawkish than expected FOMC meeting.

The U.S. dollar is surging this morning off the more hawkish than expected Fed and gold is getting hit hard as currency markets re-price for a less dovish Fed.

Economically the only notable number was the Australian Labour Force Survey, which handily beat expectations (115k job adds vs. (E) 30k), reflecting the global nature of the economic recovery.

Today there are two notable economic reports, Jobless Claims (E: 364K) and Philadelphia Fed manufacturing Index (E: 30.8) but unless either number is a substantial surprise, they shouldn’t move markets.  Instead, markets will be watching the dollar and Treasury yields for reaction to the Fed.  If both rally hard throughout the day, that will pressure stocks further as it erodes some of the “dovish Fed” support that’s helped the S&P 500 rally to recent highs.

Tom Essaye Quoted in Aljazeera on June 14, 2021

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As Bitcoin tops $40,000 again, analysts eye $50,000

Bitcoin is always going to be volatile and the manic run-up we had was never sustainable. The question is…said Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter. Click here to read the full article.

 

Tom Essaye Quoted in Yahoo Finance on June 9, 2021

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Market Recap: Wednesday, June 9

Stocks traded mixed on Wednesday as investors considered more mixed data on the…said Tom Essaye, founder and president of Sevens Report Research. Click here to read the full article.

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Tom Essaye Quoted in Yahoo Finance on June 10, 2021

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Stock market news live updates: Stocks rise, S&P 500 hits record despite hotter-than-expected inflation data

In the past two months, everything the market priced in has essentially happened. COVID is effectively over here in the United States, we’re not getting…Tom Essaye, president of Sevens Report Research, told Yahoo Finance on Wednesday. Click here to read the full article.

Tom Essaye Quoted in Barron’s on June 9, 2021

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Colgate-Palmolive Rises, Wendy’s Falls, and Stocks Aren’t Doing Much

A sense of trader paralysis grips global markets ahead of key catalysts due in…writes Tom Essaye, founder of Sevens Report Research. Click here to read the full article.