If there’s a reason for the rally, it’s the growing sense that the Fed won’t…market analyst Tom Essaye, author of the Sevens Report, wrote in a Tuesday email. Click here to read the full article.
What’s in Today’s Report:
U.S. equity futures are little changed this morning as Chinese markets began to stabilize amid easing concerns about increased regulation while focus turns to the Fed.
In company specific news, MSFT and GOOGL are trading higher after reporting record earnings while AAPL is down on disappointing guidance.
There are no notable economic reports today which will leave markets focused on the FOMC Decision (2:00 p.m. ET) and Fed Chair Powell’s Press Conference (2:30 p.m. ET). But as long as there is not a materially hawkish shift in tone, the market reaction should be relatively muted.
Additionally, there are some major companies releasing Q2 earnings results today including: PFE ($0.98), BA (-$0.65), MCD ($2.12), GD ($2.52) before the open, and FB ($3.03), PYPL ($1.14), and QCOM ($1.67) after the close.
What’s in Today’s Report:
S&P futures are trading at all-time highs this morning amid renewed stimulus hopes and more vaccine optimism.
Secretary Mnuchin presented a $916B coronavirus relief plan late Tuesday that satisfied demands from both sides of the aisle in Congress, upping chances for a yearend deal.
Vaccine news remains positive as the U.K. began administering the Pfizer vaccine yesterday and the FDA may approve the same vaccine in the U.S. as soon as tomorrow.
Looking into today’s session there is one economic report to watch: October JOLTS (E: 6.40M) due out shortly after the bell while no Fed officials are scheduled to speak.
There is a 10-Yr Treasury Note Auction at 1:00 p.m. ET which could impact the bond market and ultimately equities if the moves are significant enough however investor focus is likely to largely remain on stimulus talks and the next steps in the vaccine roll-out process.
“While there will be some discussion about how many people will take the vaccine, and some consternation that it’s a two-dose vaccine that takes 28 days to achieve effectiveness…” writes The Sevens Reports’ Tom Essaye. Click here to read the full article.
What’s in Today’s Report:
Stock futures are little changed this morning after wavering between gains and losses overnight as investors eye rising COVID-19 cases, an uptick in lockdown measures in the U.S., as well as stimulus and vaccine uncertainties.
Several economic reports in the EU including the German ZEW Survey as well as the U.S. NFIB Small Business Optimism Index missed estimates which is acting as a headwind on stocks this morning.
Looking into today’s session there is one economic report to watch: September JOLTS (E: 6.508M) and two Fed officials are scheduled to speak: Rosengren (10:00 a.m. and 4:00 p.m. ET) and Brainard (5:00 p.m. ET).
Additionally, the Treasury will hold a 10-Yr Note action at 1:00 p.m. ET and with the massive steepening we saw in the yield curve yesterday, the outcome could influence a further steepening trend which will eventually become a headwind for equities.
Outside of those potential catalysts, investor focus will remain on emerging details about the COVID-19 vaccine, specifically when it will be available and how it may impact the next stimulus package from Congress.
What’s in Today’s Report:
Futures are moderately higher again following better than expected economic data overnight.
Chinese economic data was solid as August Retail Sales (0.5% vs. (E) 0.1%) and Industrial Production (5.6% vs. (E) 5.1%) both beat estimates. In Europe, the German ZEW expectations index also beat estimates (77.4 vs. (E) 69.5). Bottom line, the data implies the global economic recovery is still on going.
On the vaccine front, headlines were more mixed as the resumption of the AZN trial in the U.S. isn’t expected until the middle of this week, at the earliest. But, markets still very much expect a vaccine to be approved by Election Day and distributed by year-end (and that remains a very optimistic assumption).
Today the looming Fed meeting (tomorrow) should keep the markets generally quiet, although we do get the September Empire Manufacturing Survey (E: 6.5), which is the first data point for September. If it’s stronger than expected, that will further confirm the U.S. economy remains resilient despite no more stimulus, and that will help support the early rally in futures.
What’s in Today’s Report:
Futures are moderately lower on digestion of Wednesday’s rally and some disappointing economic data.
EU Retail Sales badly missed estimates (-1.3% vs. (E) 1.5%) which is slightly increasing concern about the EU economic recovery.
Global August service and composite PMIs (China/EU) were generally in-line with expectations while the British service PMI slightly missed estimates (58.8 vs. (E) 60.1). Bottom line, the numbers weren’t great, but they weren’t awful either and generally speaking they won’t change the current market outlook.
Today there are two important economic reports, Jobless Claims (E: 977K) and the ISM Non-Manufacturing PMI (E: 56.8), and the market will want to see the actual data close to or better than both numbers to reinforce the economic recovery is ongoing. There’s also one Fed speaker today, Evans at 1:00 p.m. ET.
Finally, it’s important to note that vaccine “chatter” is getting louder and the chance we get a vaccine announcement before the election (November 3rd) is rising. Yesterday the CDC formally notified all 50 states to be ready to distribute a vaccine by late October/early November, so I want everyone to be aware of that, as a vaccine announcement would be another positive for stocks.
What’s in Today’s Report:
S&P 500 futures are approaching record highs this morning amid news that Russia has approved a COVID-19 vaccine while investors remain optimistic for a U.S. stimulus deal.
In a televised meeting, Russian President, Vladimir Putin, stated that Moscow’s Gamaleya Institute successfully developed a “safe and effective” coronavirus vaccine ready to move to a Phase 3 trial, sparking risk-on money flows.
Economically, both the German ZEW Survey and the NFIB Small Business Optimism Index largely met estimates and importantly did not alter the narrative that the broader global economic recovery remains underway.
Today, there is one economic report: PPI (E: 0.3%) and one Fed official is scheduled to speak: Daly (12:00 p.m. ET) but neither should move markets as investors will be keenly focused on the details surrounding the Russian coronavirus vaccine as well as any new progress towards a deal on the next U.S. stimulus bill.
“The bottom line is that if we do see real disappointment in stimulus or the vaccine, then a 10% correction is the likely best-case scenario…” said Tom Essaye of The Sevens Report, in a note. Click here to read the full article.
“The bottom line is that if we do see the real disappointment in the stimulus or the vaccine, then a 10% correction is the likely…” said Tom Essaye of The Sevens Report, in a note. Click here to read the full article.
