“The Biden administration introduced an ‘SPR put’ to the oil market this week when they announced purchasing crude to replenish reserves when prices dip towards $70 a barrel,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch. Click here to read the full article.
What’s in Today’s Report:
Futures are slightly higher as momentum from Friday’s close offset steep losses in Chinese markets.
The Hang Seng fell 6% as Premier Xi emerged from China’s National Conference with an even tighter grip on power, ensuring continued “zero COVID” policies and heightened tensions with the West.
Economically, the Euro Zone and UK flash PMIs missed estimates as both remained below 50 (47.1 and 47.2 respectively).
This week will being a deluge of critical earnings reports but that doesn’t’ start until tomorrow, so focus today will be on the flash PMIs (October Flash Manufacturing PMI (E: 51.2), October Flash Services PMI (E: 49.3)) and if those numbers show solid activity and falling prices, stocks can extend the rally.
What’s in Today’s Report:
Futures are moderately lower following a disappointing night of earnings.
Thursday night was the first bad night of earnings as SNAP and WHR both posted underwhelming results, while numerous European companies also missed estimates.
Economically, the Japanese CPI ran hot (3.0% vs. (E) 2.9%), like virtually every other inflation indicator this week.
Today there are no economic reports and just one Fed speaker, Williams (9:10 a.m. ET), but he shouldn’t move markets.
Instead, the focus will continue to shift toward earnings and the markets needs some good results to rally today. Reports we’re watching today include: VZ ($1.28), AXP ($2.38), SLB ($0.55), HCA ($3.89).
What’s in Today’s Report:
Futures are slightly lower following a night of mixed earnings results and yet another firm inflation report.
TSLA missed on revenue and production targets and the stock fell –5% after hours, although overall earnings reports were more mixed than negative overnight.
German PPI was the latest global inflation indicator to run hotter than estimates (2.3% vs. (E) 1.5%) reinforcing that global inflation is proving “sticky.”
Today’s focus will be on economic data and the key reports are (in order of importance): Philly Fed (-5.0), Jobless Claims (E: 235K), and Existing Home Sales (E: 4.695M). If we can see a moderation in the data (especially in the price indices in Philly Fed) then stocks can rally. We also get numerous Fed speakers including: Harker (12:00 p.m. ET), Jefferson (1:30 p.m. ET), Cook (1:45 p.m. ET), and Bowman (2:05 p.m. ET) but none of them should move markets.
Finally, earnings season rolls on although the critically important results really increase next week. Some reports we’re watching today include: AAL ($0.54), SNAP ($0.00), and WHR ($5.59).
What’s in Today’s Report:
Futures are slightly higher in more cautious trade this morning as strong earnings from NFLX (+14%) and UAL (+3%) are helping offset hot inflation data overseas.
UK CPI rose 0.2% to 10.1% vs. (E) 10.0%, revisiting a 40-year high which is bringing inflation back into focus today.
From a catalyst standpoint, there is one economic report to watch today: Housing Starts (1.475M), and two Fed speakers to watch: Kashkari (1:00 p.m. ET) and Evans (6:30 p.m. ET).
There is also a 20-Yr Treasury Bond Auction at 1:00 p.m. ET. If yields rise in the wake of the auction, that could once again weigh on equities.
Finally, earnings continue with: ALLY ($1.73), PG ($1.55), CFG ($1.21), and WGO ($2.99) reporting ahead of the bell, and TSLA ($1.01), IBM ($1.78), AA ($0.09), and PPG ($1.67) releasing their results after the bell.
Bottom line, there have been some incremental fundamental positives that have helped support the relief rally in stocks this week, and if fixed-income markets can remain orderly and earnings continue to surprise to the upside, the S&P 500 could continue towards 3,800 or beyond today.
Inflation cooling is the “key to market stabilization,” Sevens Report analyst Tom Essaye wrote in a Monday note, pointing out that the Federal Reserve and other central banks will not ease their monetary policy until there’s “conclusive” proof of inflation receding. Click here to read the full article.
What’s in Today’s Report:
U.S. equity futures are up more than 1% in sympathy with EU markets following mixed messages about BOE policy.
An FT article overnight said the BOE would delay QT plans further in an attempt to insure stability in U.K. markets which fueled a continued rebound in risk assets, however, the BOE later said the report was “inaccurate” which has seen some of those pre-market moves unwind.
Looking into today’s session, there are two economic reports to watch: Industrial Production (E: 0.1%) and the Housing Market Index (E: 44) while there are two Fed officials scheduled to speak: Bostic (2:00 p.m. ET) and Kashkari (5:30 p.m. ET).
Earnings season will continue to pick up today with GS ($7.47), JNJ ($2.49), and LMT ($6.60) reporting ahead of the bell while NFLX ($2.11), UAL ($2.21), and JBHT ($2.46) releasing results after the close.
Bottom line, risk assets remain buoyant following last week’s volatility, and as long as fixed-income markets continue to stabilize and earnings do not materially disappoint, the relief rally that stocks enjoyed yesterday should be able to extend higher today.
“Oil has given back roughly half of the October gains this week thanks to the negative shift in policy and economic outlooks denting demand expectations,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch. Click here to read the full article.
“I don’t think there’s anything in here [minutes] that changes the outlook,” said Sevens Report’s Tom Essaye. Click here to read the full article.
What’s in Today’s Report:
Futures are moderately higher after new UK Chancellor of the Exchequer Jeremy Hunt abandoned virtually all of the tax cut proposals in PM Truss’s spending/stimulus plan.
Hunt’s announcement of the abandoning of tax cuts and a review in April of the energy subsidies are easing market concerns and pushing the Pound higher and global yields lower.
Outside of the UK fiscal news it was a mostly quiet weekend.
Today focus will be on the Empire Manufacturing Survey (E: -2.5) which is our first look at October data, and markets will want to see moderation in the headline and a continued drop in the price index, and if that occurs stocks can extend the rebound.
On the earnings front, activity ramps up later in the week but some results we’re watching today include: BAC ($0.79), SCHW ($1.05), BK ($1.10).