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 22 points and are trading 0.2% above fair value. The Dow Jones Industrial Average futures are up 183 points and are trading 0.5% above fair value. Equity futures indicate a higher open after sizable losses recently. The upside bias is partially due to a general seasonal bias during this Santa Claus rally period (last five trading days of the year plus the first two trading sessions of the new year). Market participants are also reacting to reports that China is aiming to end quarantine requirements for international travelers on January 8 despite a coronavirus surge, which is expected to peak on New Year’s Day at 2 million cases per day, according to The Wall Street Journal. On a related note, China stepped up military drills, sending a swath of warplanes near Taiwan, according to The Wall Street Journal. Russian President Putin says he is ready to negotiate with Ukraine, but Ukraine says Russia does not want talks, according to Reuters. A report from Mastercard SpendingPulse showed that U.S. retail sales grew 7.6% this holiday season. There is… Read More
Headline News: The S&P 500 futures are up 8 points and are trading 0.3% above fair value. The Nasdaq 100 futures are up 31 points and are trading 0.4% above fair value. The Dow Jones Industrial Average futures are up 79 points and are trading 0.2% above fair value. The equity futures market indicates a modestly higher open coming off yesterday’s retreat, waiting on some key economic data at 8:30 a.m. ET. Today marks the official start of the so-called Santa Claus rally period, which includes the last five sessions of the year and the first two sessions of the new year. Airlines canceled thousands of flights due to the winter storm ahead of the year-end holidays, according to CNBC. The House will vote on the $1.7 trillion government funding bill today, and it is expected to pass, according to CNBC. China estimates 37 million residents per day are getting infected with COVID, according to Bloomberg. Japan’s core CPI was up 3.7% yr/yr in the November reading, increasing at its fastest pace since early 1982. Treasury yields are inching higher ahead of the Fed’s preferred inflation gauge, the PCE Price Index and core- PCE Price Index. The 2-yr note yield… Read More
Headline News: The S&P 500 futures are down 9 points and are trading 0.3% below fair value. The Nasdaq 100 futures are down 39 points and are trading 0.3% below fair value. The Dow Jones Industrial Average futures are down 62 points and are trading 0.2% below fair value. Equity futures skew slightly negative as market participants react to disappointing earnings reports from Micron (MU) and CarMax (KMX). This is amid thinner holiday trading conditions as many participants bow out ahead of the weekend. Congress is at a standstill on the government funding bill due to a dispute regarding an immigration amendment ahead of Friday’s deadline, according to Politico. China will lower quarantine requirements for overseas travelers next month, according to Bloomberg. Treasury yields are modestly lower. The 2-yr note yield is down one basis point to 4.21%, and the 10-yr note yield is down three basis points to 3.65%. UK Q3 GDP was revised to -0.3% from -0.2% quarter-over-quarter versus +0.2% in Q2. Market participants will receive the following U.S. economic data today: 8:30 a.m. ET: Q3 GDP Third Estimate (Briefing.com consensus 2.9%; prior 2.9%) and GDP Deflator Third Estimate (Briefing.com consensus 4.3%; prior 4.3%) 8:30 a.m. ET: Weekly… Read More
Headline News: The S&P 500 futures are up 25 points and are trading 0.7% above fair value. The Nasdaq 100 futures are up 44 points and are trading 0.4% above fair value. The Dow Jones Industrial Average futures are up 266 points and are trading 0.8% above fair value. The futures for the main indices, especially the Dow, are getting a boost today as market participants react positively to earnings reports from Nike (NKE) and FedEx (FDX). Some speculative buying interest following large losses this month also offers a measure of support to the equity futures market. The Senate passed a procedural measure on the $1.7 trillion government funding bill. A final Senate vote could happen later today, according to Politico. Ukraine’s President Zelenskyy is visiting Washington DC, today to meet with President Biden and speak in front of Congress. Treasury yields are moving lower this morning. The 2-yr note yield is down six basis points to 4.21%, and the 10-yr note yield is down two basis points to 3.66%. Energy complex futures are on the rise. WTI crude oil futures are up 2.3% to $77.97/bbl, and natural gas futures are up 2.8% to $5.47/mmbtu. The weekly MBA Mortgage Applications… Read More
Headline News: The S&P 500 futures are down 6 points and are trading 0.2% below fair value. The Nasdaq 100 futures are down 49 points and are trading 0.4% below fair value. The Dow Jones Industrial Average futures are up 1 point and are trading slightly above fair value. Equity futures are mixed this morning, but moves are modest in scope. Bigger moves since yesterday’s close have been more concentrated in the bond market after a surprise move by the Bank of Japan. The Bank of Japan modified its yield curve control policy, announcing that the 10-yr yield will be allowed to rise to 0.50%, up from the old cap of 0.25%, but left its benchmark rate unchanged at -0.1%, as expected. On a related note, Japan’s Finance Minister Suzuki said that a decision had not been made to revise the joint mission statement with the Bank of Japan. Treasury yields moved noticeably higher while the yen surged against the dollar (USD/JPY -3.2% to 132.58). The U.S. Dollar Index is down 0.6% to 104.05. The 2-yr note yield, which hit 4.30% overnight, is up three basis points to 4.27%, and the 10-yr note yield, which hit 3.71% overnight, is up… Read More
Headline News: The S&P 500 futures are up 12 points and are trading 0.2% above fair value. The Nasdaq 100 futures are up 50 points and are trading 0.4% above fair value. The Dow Jones Industrial Average futures are up 73 points and are trading 0.2% above fair value. Equity futures are up this morning, presumably fueled by some bargain-hunting activity following the poor finish last week and larger losses over the last two weeks. There are ongoing reports about COVID cases increasing rapidly in China. There was speculation that the Bank of Japan and the Japanese government will revise their objective, opening the door to a modification of the BoJ’s ultra-loose monetary policy, according to Reuters. However, Japan’s chief cabinet secretary pushed back against the speculation. Lawmakers are expected to work on a $1.7 trillion government funding bill this week ahead of Friday’s funding deadline, according to The Wall Street Journal. The 2-yr Treasury note yield is flat at 4.19%, while the 10-yr note yield is up six basis points to 3.54%. Economic data today is limited to the December NAHB Housing Market Index (Briefing.com consensus 34; prior 33) at 10:00 a.m. ET. (Michael Gibbs, Director of Equity Portfolio &… Read More
Headline News: Consumers pulled back on spending in November, failing to keep up with even a muted level of inflation for the month, the Commerce Department reported Thursday. Retail sales for the month declined 0.6%, even worse than the Dow Jones estimate for a 0.3% drop. The number is not adjusted for inflation as gauged by the Labor Department’s consumer price index, which increased 0.1% in November, which also was below expectations. Measures that exclude autos and both autos and gas sales both showed 0.2% declines. The pullback was widespread across categories. Furniture and home furnishings stores reported a decrease of 2.6%, building materials, and garden centers were off 2.5%, and motor vehicle and parts dealers dropped 2.3%. Even with declining gas prices, service stations were down just 0.1%. Online sales also decreased, falling 0.9%, while bars and restaurants increased 0.9% and food and beverage stores rose 0.8%. On a year-over-year basis, retail sales increased by 6.5%, compared to a CPI inflation rate of 7.1%. (Jeff Cox CNBC) | Markets: The S&P 500 traded in a wide range again and closed lower at 3995.32. The 200-day moving average at 4032.14 was breached early in the day, only to see selling… Read More
Headline News: Prices rose less than expected in November, the latest sign that the runaway inflation that has been gripping the economy is beginning to loosen up. The consumer price index, which measures a wide basket of goods and services, rose just 0.1% from the previous month and increased 7.1% from a year ago, the Labor Department reported Tuesday. Economists surveyed by Dow Jones had been expecting a 0.3% monthly increase and a 7.3% 12-month rate. The increase from a year ago, while well above the Federal Reserve’s 2% target for a healthy inflation level, was tied for the lowest since November 2021. Excluding volatile food and energy prices, so-called core CPI rose 0.2% on the month and 6% on an annual basis, compared to respective estimates of 0.3% and 6.1%. (Jeff Cox CNBC) | Markets: The S&P 500 moved above the 50-day moving average at 3986.95 and closed higher at 3990.56. RSI also increased in support of the rally and is now back above 50, closing at 54.21. However, the trading came with 258,373,376; of that, only 64% was up volume. So far this morning, the S&P 500 futures are higher by 2.66%, with a suggested open of 4134.24,… Read More
Headline News: The S&P 500 futures are up 10 points and are trading 0.3% above fair value. The Nasdaq 100 futures are up 28 points and are trading 0.2% above fair value. The Dow Jones Industrial Average futures are up 61 points and are trading 0.2% above fair value. Coming off last week’s losses, the equity futures market indicates a modestly higher open. Some M&A news this morning and some bargain-hunting pursuits after last week’s large losses are helping to prop things up. Still, there is likely some hesitation in play as market participants await the November Consumer Price Index tomorrow at 8:30 a.m. ET followed by the FOMC decision Wednesday. In addition to the Fed’s FOMC meeting, the European Central Bank and the Bank of England will announce policy decisions on Thursday. According to Bloomberg, COVID cases are spreading rapidly through China, but the government is continuing to ease its zero-COVID policies. Treasury yields are moving lower. The 2-yr note yield is down two basis points to 4.32%, and the 10-yr note yield is down three basis points to 3.53%. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) | Markets: The S&P 500 closed lower at 3934.38, and the… Read More
Headline News: The S&P 500 futures are up 11 points and are trading 0.3% above fair value. The Nasdaq 100 futures are up 33 points and are trading 0.3% above fair value. The Dow Jones Industrial Average futures are up 78 points and are trading 0.2% above fair value. The market has finished lower in eight of the last nine sessions, so equity futures are modestly higher now with an expectation that the market is due for a bounce. Hong Kong could relax masking and COVID testing rules, according to Bloomberg. Treasury yields are inching higher. The 2-yr note yield is up three basis points to 4.27%, and the 10-yr note yield is up four basis points to 3.46%. The U.S. Dollar Index is flat at 105.13. Energy complex futures are moving up this morning. WTI crude oil futures are up 2.5% to $73.85/bbl, and natural gas futures are up 1.7% to $5.82/mmbtu. The initial and continuing jobless claims report is due at 8:30 a.m. ET today, although market participants understandably remain preoccupied with the November Producer Price Index tomorrow at 8:30 a.m. ET. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) | Markets: The S&P 500 moved lower for… Read More
