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 41 points and are trading 0.4% above fair value. The Dow Jones Industrial Average futures are up 58 points and are trading 0.2% above fair value. The stock market looks poised for a higher open, but the positive bias is modest in scope as earnings season progresses. Market participants are also eyeing the December Producer Price Index, which will be released at 8:30 a.m. ET. The Japanese yen fell sharply against the dollar after the Bank of Japan maintained its ultra-loose policy against some expectations that the yield targets could be changed. The U.S. Dollar Index is down 0.3% to 102.08, with USD/JPY +0.7% to 129.08. European Central Bank policymaker Villeroy de Galhau pushed back against earlier reports that the ECB is apt to reduce the size of its rate hikes at the policy meeting in March. He added that inflation is expected to return to target by 2025. Treasury yields are noticeably lower this morning. The 2-yr note yield is down three basis points to 4.16%, and the 10-yr note yield is down seven basis points… Read More
Headline News: The S&P 500 futures are down 12 points and are trading 0.3% below fair value. The Nasdaq 100 futures are down 48 points and are trading 0.5% below fair value. The Dow Jones Industrial Average futures are down 125 points and are trading 0.4% below fair value. There’s a negative bias in the equity futures market after a big run recently. Entering today, the S&P 500, Nasdaq, and Dow are up 4.2%, 5.9%, and 3.5%, respectively, so far in 2023. In addition, earnings reports this morning are receiving mixed reactions from market participants. The IMF’s Managing Director Kristalina Georgieva told CNBC in an interview “…we expect growth to bottom out this year and 2024 to be a year in which we finally see the world economy on an upside.” China’s Q4 GDP came in better than feared at 0.0% quarter/quarter versus an expected 0.8% decline. Treasury yields are inching higher. The 2-yr note yield is up three basis points to 4.25%. The 10-yr note yield is up six basis points to 3.57%. The U.S. Dollar Index is down 0.1% to 102.12. WTI crude oil futures are up 0.6% to $80.33/bbl and natural gas futures are up 5.9% to… Read More
Headline News: Inflation closed out 2022 in a modest retreat, with consumer prices in December posting their biggest monthly decline since early in the pandemic, the Labor Department reported Thursday. The consumer price index, which measures the cost of a broad basket of goods and services, fell 0.1% for the month, in line with the Dow Jones estimate. That equated to the largest month-over-month decrease since April 2020, as much of the country was in lockdown to combat Covid. Even with the decline, headline CPI rose 6.5% from a year ago, highlighting the persistent burden that the rising cost of living has placed on U.S. households. However, that was the smallest annual increase since October 2021. Excluding volatile food and energy prices, so-called core CPI rose 0.3%, also meeting expectations. Core was up 5.7% from a year ago, once again in line. (Jeff Cox CNBC) Markets: The S&P 500 rallied sharply to close higher at 3969.61 and is now just below the 200-day moving average at 3987.35. RSI also moved higher in support of the rally closing at 58.16, which was the highest close in a month. However, the internal indicators are now in the overbought zone, and the… Read More
Headline News: The S&P 500 futures are up 6 points and are trading 0.2% above fair value. The Nasdaq 100 futures are up 16 points and are trading 0.2% above fair value. The Dow Jones Industrial Average futures are up 53 points and are trading 0.2% above fair value. The equity futures market is slightly positive, but market participants lack conviction ahead of the December Consumer Price Index (CPI) on Thursday, followed by bank earnings reports on Friday. Concerns about the Fed triggering a hard landing and earnings estimates possibly getting cut further have driven choppy price action in the market, so investors will be keenly focused on the CPI report and the start of the Q4 earnings reporting season. The World Bank lowered 2023 global growth expectations to +1.7% from +3.0% expected six months ago and sees 2024 global growth at +2.7%. A short time ago, the FAA tweeted, “The FAA is still working to fully restore the Notice to Air Missions system following an outage. The FAA has ordered airlines to pause all domestic departures until 9 a.m. Eastern Time to allow the agency to validate the integrity of flight and safety information.” The 2-yr Treasury note yield… Read More
Headline News: The S&P 500 futures are up 17 points and are trading 0.5% above fair value. The Nasdaq 100 futures are up 61 points and are trading 0.5% above fair value. The Dow Jones Industrial Average futures are up 115 points and are trading 0.4% above fair value. The stock market is poised for a higher open driven by optimism that Friday’s rally will continue as market participants take account of lower interest rates and the possibility of a soft landing. China removed all border restrictions, according to The Wall Street Journal. Representative Kevin McCarthy won the election for Speaker of the House after 15 ballots. Jair Bolsonaro supporters stormed Brazil’s Congress and presidential offices, according to the NY Times. Economic data today is limited to the November Consumer Credit report (prior to $27.0 billion) at 3:00 p.m. ET. The 2-yr Treasury note yield is flat at 4.27%, and the 10-yr note yield is up three basis points to 3.60% (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 rallied sharply by 2.28% and closed at 3895.08 on Friday. The rally was confirmed by RSI closing above the 50 level at 51.61, and upside volume… Read More
Headline News: The S&P 500 futures are up 1 point and are trading roughly in line with fair value. The Nasdaq 100 futures are up 12 points and are trading 0.1% above fair value. The Dow Jones Industrial Average futures are down 15 points and are trading roughly in line with fair value. The equity futures market is mixed and little changed as participants lack conviction. There’s some mixed action in the mega-cap space this morning. Those stocks have exhibited fickle behavior recently, so market participants are in a wait-and-see mode ahead of the open. The Santa Claus rally ended with a net gain over the seven-day stretch, which historically has been regarded as a positive sign for the start of the new year. The second-ranking IMF official Gita Gopinath warned that the U.S. has not “turned the corner yet” on inflation, according to FT. The House failed to elect a Speaker yesterday and will return to session at 12:00 p.m. ET today to resume the voting process. The Treasury market trades in mixed fashion this morning. The 2-yr note yield is up two basis points to 4.39% and the 10-yr note yield is down two basis points to 3.70%.… Read More
Headline News: The S&P 500 futures are up 6 points and are trading 0.2% above fair value. The Nasdaq 100 futures are up 38 points and are trading 0.4% above fair value. The Dow Jones Industrial Average futures are up 48 points and are trading 0.1% above fair value. There’s a positive bias in the equity futures market on this final day of the Santa Claus rally period. Some bargain-hunting activity and nice gains in the mega-cap space, except Microsoft (MSFT) sporting losses on a downgrade at UBS, are fueling the upside moves. The S&P 500 stood at 3,822 when this year’s Santa Claus rally period began, and yesterday’s close brought the index just a whisker above that level (3,824). Encouraging inflation data out of Europe, including Germany’s November Import Price Index and France’s December Consumer Price Index, also helps to boost investor sentiment this morning. These reports play into the peak inflation narrative, which may be driving Treasury yields lower. The 2-yr note yield is down two basis points to 4.35%, and the 10-yr note yield is down nine basis points to 3.69%. The U.S. Dollar Index is down 0.4% to 104.13. Energy complex futures continue to suffer losses.… Read More
Headline News: Morning Briefing – Lower start indicated for the last trading session of the year The S&P 500 futures are down 19 points and are trading 0.5% below fair value. The Nasdaq 100 futures are down 87 points and are trading 0.8% below fair value. The Dow Jones Industrial Average futures are down 119 points and are trading 0.4% below fair value. Market participants are a fickle bunch on this last trading session of the year, with the equity futures market indicating a lower open after yesterday’s decent gains. The negative bias is driven in part by premarket losses in mega-cap stocks amid thinner trading volume ahead of an extended holiday weekend. President Biden signed the $1.7 trillion government spending bill. There are growing concerns about a Covid surge in China and possible disruptions to supply chains in early 2023. Treasury yields are inching higher. The 2-yr note yield is up two basis points to 4.39%, and the 10-yr note yield is up two basis points to 3.85%. Economic data today is limited to the December Chicago PMI (Briefing.com consensus 40.0; Prior 37.2) at 9:45 a.m. ET. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P… Read More
Headline News: The S&P 500 futures are up 16 points and are trading 0.4% above fair value. The Nasdaq 100 futures are up 64 points and are trading 0.7% above fair value. The Dow Jones Industrial Average futures are up 75 points and are trading 0.2% above fair value. There’s a positive bias in the equity futures market this morning, thanks to decent gains in Tesla (TSLA) and renewed interest in other mega-cap stocks. Some bargain-hunting activity after recent weakness is likely helping boost the market. The U.S. and other countries will require a negative Covid test before entry for travelers from China. The 2-yr Treasury note yield is up one basis point to 4.36%, and the 10-yr note yield is flat at 3.88%. The U.S. Dollar Index is down 0.3% to 104.17. WTI crude oil futures are down 1.0% to $78.24/bbl. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 sold off below support at 3806.91 and closed lower at 3783.232. The trading came with low volume of 1,723,097,856 shares traded, and RSI also closed lower at 39.07 in support of the selling. However, 82% of the selling was down volume showing that the selling… Read More
Headline News: The S&P 500 futures are up points and are trading 0.3% above fair value. The Nasdaq 100 futures are up 31 points and are trading 0.3% above fair value. The Dow Jones Industrial Average futures are up 99 points and are trading 0.3% above fair value. The stock market is poised for a higher open as the Santa Claus rally period (the last five trading days of the year plus the first two trading sessions of the new year) continues. Some speculative bargain-hunting interest is likely playing a role after many stocks registered sizable losses recently. Hong Kong ended its major remaining coronavirus restrictions, according to Bloomberg. The U.S. is considering new coronavirus measures for travelers from China, according to The Wall Street Journal. Russia has banned oil sales to countries with imposed price caps, according to The Wall Street Journal. On a related note, energy complex futures are moving lower this morning. WTI crude oil futures are down 0.4% to $79.22/bbl, and natural gas futures are down 6.2% to $4.96/mmbtu. Economic data today is limited to November Pending Home Sales (Briefing.com consensus -0.2%; prior -4.6%) at 10:00 a.m. ET. Treasury yields are declining. The 2-yr note yield… Read More
