The Easiest Way to Explain This Market To Clients

What’s in Today’s Report:

  • The Easiest Way To Explain This Market To Clients
  • Technical Market Update (Volume Not Confirming The Rally)
  • A More “Hawkish” Fed than we think?

Futures and global markets are moderately higher as global economic data beat expectations, furthering hopes of a global growth rebound.

March Chinese exports handily beat estimates, rising 14.2% vs. (E) 8.4% while EU Industrial Production wasn’t as bad as feared (-0.2% vs. (E ) -0.6%).

Focus turns to earnings this morning as all eyes will be on three big banks:  JPM ($2.32), WFC ($1.08), PNC ($2.59).  If they post solid numbers, then combined with the good Chinese economic data, we could see an extension of this rally.

Outside of earnings, we do get Import/Export Prices (E: 0.4%/0.3%) and Consumer Sentiment (E: 98.0).  Plus, Powell speaks to House Democrats but no comments on policy are expected and none of those events should move markets.

Technical Update (Encouraging Signals)

What’s in Today’s Report:

  • Market Technical Update (Encouraging Signals)
  • Why Stocks Rebounded Yesterday
  • Why the Yield Curve Has Flattened SO Quickly (Blame Oil)

Futures are modestly lower as markets digest yesterday’s late day rally and look ahead to this morning’s jobs report.

Geopolitically, initial reports imply the U.S./China trade talks will continue despite the Huawei CFO arrest, which if confirmed is clearly a positive.

Global economic data was mixed again as Chinese currency reserves beat estimates while German IP missed.  But, neither number is moving markets this morning.

Today is all about the jobs report and given sudden uncertainty on Fed policy (will they pause?) this jobs report is now the most important one of the year.  Expectations are as follows:  Job Adds: (E) 190K, UE Rate: (E) 3.7%, Wages (E) 3.2% yoy), and the best outcome for stocks is a “mild miss” across all three segments.

Away from the jobs report we also get Consumer Sentiment (E: 97.4) and one Fed speakers, Brainard (12:15 p.m. ET).