Headline News: The S&P 500 futures are down 8 points and are trading 0.2% below fair value. The NASDAQ 100 futures are down 66 points and are trading 0.4% below fair value. The Dow Jones Industrial Average futures are up 3 points and are trading roughly in line with fair value. There’s not a lot of conviction on either side of the tape, driving mixed action in the equity futures market. Participants are waiting to see if there will be any follow-through to yesterday’s rally. Weakness in chipmakers following reports that the U.S. is mulling new restrictions on artificial intelligence chip exports from China has weighed on the broader market. Fed Chair Powell will speak on a policy panel at the European Central Bank (ECB) Forum on Central Banking 2023 in Sintra, Portugal, at 9:30 a.m. ET. Mr. Powell wrapped up his semiannual monetary policy testimony before Congress last Thursday, so there shouldn’t be anything too surprising in his commentary today. After today’s close, the Federal Reserve will release the results from the annual bank stress tests. The weekly MBA Mortgage Applications Index rose 3.0%, with purchase applications and refinancing applications each rising 3.0%. The 2-yr Treasury note yield is… Read More
Headline News: The S&P 500 futures are up 3 points and are trading 0.1% above fair value. The NASDAQ 100 futures are up 49 points and are trading 0.3% above fair value. The Dow Jones Industrial Average futures are down 55 points and are trading 0.2% below fair value. The S&P 500 and NASDAQ 100 futures are somewhat higher this morning, thanks to some rebound action in the mega-cap stocks. Dow Jones Industrial Average futures trade on the weaker side. Quarter-end rebalancing activity will be in play again today. Market participants will also have a slate of economic data to digest that will include: 8:30 ET: May Durable Orders (Briefing.com consensus -1.0%; prior 1.1%) and Durable Orders -ex transportation (Briefing.com consensus 0.0%; prior -0.2%) 9:00 ET: April FHFA Housing Price Index (prior 0.6%) and April S&P Case-Shiller Home Price Index (Briefing.com consensus -2.5%; prior -1.1%) 10:00 ET: June Consumer Confidence (Briefing.com consensus 103.8; prior 102.3) and May New Home Sales (Briefing.com consensus 665,000; prior 683,000) The 2-yr Treasury note yield is down six basis points to 4.68%, and the 10-yr note yield is unchanged at 3.72%. The U.S. Dollar Index is down 0.1% to 102.55. (Michael Gibbs, Managing Director, Lead… Read More
Headline News: The S&P 500 futures are down 15 points and are trading 0.4% below fair value. The NASDAQ 100 futures are down 97 points and are trading 0.6% below fair value. The Dow Jones Industrial Average futures are down 52 points and are trading 0.2% below fair value. Stock futures are weak this morning. Fed Chair Powell indicating yesterday that more rate hikes may be needed has seemingly offered an excuse for investors to take some money off the table after a big run recently. The NASDAQ 100 futures underperform due to lagging mega-cap stocks. The European Central Bank is expected to announce a 25 basis points rate hike at 8:15 a.m. ET. China’s National Bureau of Statistics cautioned that China’s economic recovery is not yet solid. Some economic data corroborated that view, including weaker-than-expected industrial production (3.5% year-over-year; expected 3.8%), retail sales (12.7% year-over-year; expected 13.7%), fixed asset investment (4.0% year-over-year; expected 4.4%) for May. In related news, the PBOC cut the 1-yr medium-term lending facility rate by 10 basis points to 2.65%. Treasury yields are moving higher. The 2-yr note yield is up five basis points to 4.75%, and the 10-yr note yield is up three… Read More
Headline News: The S&P 500 futures are up 4 points and are trading 0.1% above fair value. The NASDAQ 100 futures are up 19 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are down 92 points and are trading 0.2% below fair value. The equity futures market is mixed ahead of the Fed decision at 2:00 p.m. ET. That decision will also be accompanied by the release of the Summary of Economic Projections and will be followed by Fed Chair Powell’s press conference at 2:30 p.m. ET. The Dow futures are underperforming this morning due to a sizable loss in a large healthcare name, which warned about rising costs. The weekly MBA Mortgage Applications Index rose 7.2%, with purchase applications jumping 8.0% and refinancing applications rising 6.0%. Market participants will also receive the Producer Price Index for May at 8:30 a.m. ET. The 2-yr note yield is down four basis points to 4.66%, and the 10-yr note yield is down two basis points to 3.82%. The U.S. Dollar Index is down 0.2% to 103.16. (Michael Gibbs, Managing Director, Lead Portfolio Manager ) Markets: The S&P 500 rallied past resistance at 4325.28 and closed higher at… Read More
Headline News: The S&P 500 futures are up 12 points and are trading 0.3% above fair value. The NASDAQ 100 futures are up 74 points and are trading 0.5% above fair value. The Dow Jones Industrial Average futures are up 40 points and are trading 0.1% above fair value. Stock futures have a positive disposition to start the week. Some hopeful anticipation that the Fed will not raise rates has contributed to the positive bias along with relative strength in the mega cap stocks. It’s a big week of news that will feature the release of the May Consumer Price Index and Retail Sales, along with policy decisions from the FOMC, the European Central Bank, and the Bank of Japan. Oil prices are lower, down 2.3% to $68.58/bbl, following news that Goldman Sachs has cut its price forecast for Brent Crude (to $86 from $95) and WTI Crude (to $81 from $89) due to higher oil supplies. Treasuries are little changed from Friday’s settlement levels. The 2-yr note yield is down two basis points to 4.60%, and the 10-yr note yield is up one basis point to 3.75%. Economic data today is limited to the May Treasury Budget (prior to… Read More
Headline News: The S&P 500 futures are flat and are trading roughly in line with fair value. The NASDAQ 100 futures are up 20 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are down 63 points and are trading 0.2% below fair value. Equity futures are mixed this morning. Market participants are still in wait-and-see mode ahead of the May Consumer Price Index and Fed decision next week. China reported inflation data for May. CPI increased 0.2% year-over-year (expected 0.3%) following a 0.1% increase in April. China’s PPI, however, fell at its fastest pace since early 2016, down 4.6% year-over-year (expected -4.3%) versus a 3.6% decline in April. Treasury yields are moving higher. The 2-yr note yield is up three basis points to 4.56%, and the 10-yr note yield is up four basis points to 3.75%. The U.S. Dollar Index is pulling back from overnight highs, flat at 103.38. There is no U.S. economic data of note today. (Michael Gibbs, Managing Director, Lead Portfolio Manager ) Markets: The S&P 500 closed higher at 4293.93 after a brief attempt at the resistance at 4299.28. The index has now formed a four-day base, and traders appear to… Read More
Headline News: The S&P 500 futures are down 1 point and are trading in line with fair value. The NASDAQ 100 futures are down 12 points and are trading 0.1% below fair value. The Dow Jones Industrial Average futures are down 15 points and are trading slightly below fair value. There’s not a lot of conviction in premarket action, again. Market participants continue to play a waiting game ahead of the May Consumer Price Index and Fed decision next week. Labor issues at West Coast ports are causing vessel buildup and are leading to a breakdown in the supply chain, according to CNBC. The Reserve Bank of India left its key policy rates unchanged, as expected. Four large Chinese banks cut their yuan deposit rates, and there was speculation that the People’s Bank of China will lower its loan prime rate soon. Market participants will receive the weekly initial (Briefing.com consensus 237,000; prior 232,000) and continuing (prior 1.795 million) jobless claims at 8:30 a.m. ET. (Michael Gibbs, Managing Director, Lead Portfolio Manager ) Markets: The S&P 500 closed lower at 4267.52 and has formed a three-day base which we feel will continue until Wednesday’s Federal Reserve meeting. Markets are pricing in… Read More
Headline News: The S&P 500 futures are up 6 points and are trading 0.1% above fair value. The NASDAQ 100 futures are up 26 points and are trading 0.2% above fair value. The Dow Jones Industrial Average futures are up 5 points and are trading slightly above fair value. There’s not a lot of conviction this morning. Market participants are still contending with the notion that mega caps are due for a period of consolidation. Also, China reported a smaller-than-expected trade surplus for May as exports fell more than expected, stoking concerns over global growth prospects. The weekly MBA Mortgage Applications Index fell 1.4%, with purchase applications declining 2.0% and refinancing applications falling 1.0%. (Michael Gibbs, Managing Director, Lead Portfolio Manager ) Markets: The S&P 500 closed higher at 4283.85 and remained at the upper Bollinger Band. However, the last two trading days have formed a small base, and if that continues, the index could work off the overbought conditions that still currently exist. Also, the advance/decline line has not increased at the same pace as the S&P 500. So, there is yet to be a clear path for today’s trading. We still believe the support at 4241.01 could be tested… Read More
Headline News: The S&P 500 futures are down 2 points and are trading 0.1% below fair value. The NASDAQ 100 futures are down 2 points and are trading slightly below fair value. The Dow Jones Industrial Average futures are down 22 points and are trading 0.1% below fair value. Stock futures are softer this morning. Participants are taking a wait-and-see approach after yesterday’s nice start faded by the close. There is also a sense that mega-cap stocks are overbought on a short-term basis and are due for a period of consolidation. The Reserve Bank of Australia raised its cash rate by 25 bps to 4.10% against expectations for no change and indicated that more rate hikes may be needed. China Securities Journal speculated that the PBOC would cut its reserve requirement ratio and other interest rates in the second half of the year. Labor issues continue at some West Coast ports, according to CNBC. Treasuries are little changed from yesterday’s settlement levels. The 2-yr note yield is down one basis point to 4.47%, and the 10-yr note yield is down one basis point to 3.67%. Oil prices are declining, giving back all of yesterday’s gains. WTI crude oil futures are… Read More
Headline News: The S&P 500 futures are up 1 point and are trading in line with fair value. The NASDAQ 100 futures are down 19 points and are trading 0.2% below fair value. The Dow Jones Industrial Average futures are up 10 points and are trading 0.1% above fair value. Stock futures have been mixed, yet there hasn’t been a lot of movement in either direction. Market participants are anxious to see if Friday’s rally will continue today. Some mega-cap stocks are relatively weak this morning, limiting moves for the broader market. Oil prices are climbing after Saudi Arabia said it would implement an additional voluntary cut in its production of crude oil, amounting to one million barrels per day. WTI crude oil futures are up 2.3% to $73.38/bbl. The Port of Los Angeles and Long Beach is shut down after labor negotiations stall. Separately, President Biden signed the debt ceiling bill into law on Saturday. The 2-yr Treasury note yield is up five basis points to 4.56%, and the 10-yr note yield is up seven basis points to 3.75%. (Michael Gibbs, Managing Director, Lead Portfolio Manager ) Markets: The S&P 500 roared to a new high for the year at… Read More
