Headline News: The S&P 500 futures are down 30 points and are trading 1.2% below fair value. The Nasdaq 100 futures are down 105 points and are trading 1.5% below fair value. The Dow Jones Industrial Average futures are down 209 points and are trading 1.0% below fair value. Equity futures are decidedly weak on this options expiration day following the warning from FedEx (FDX), which piled onto existing concerns about inflation and rate hikes with a backdrop of slowing global growth. Overseas, the UK had weaker-than-expected retail sales in August. Reserve Bank of Australia Governor Lowe said that rates are still too low at this time, adding that he sees “a few” rate hikes in the coming months. South Korea’s unemployment rate reached its lowest level in the 23-year history of the series. Separately, the 2-yr note yield is up two basis points to 3.88%, and the 10-yr note yield is unchanged at 3.46%. Energy complex futures are mixed ahead of the open. WTI crude oil futures are up 1.1% to $85.98/bbl, while natural gas futures are down 1.2% to $8.22/mmbtu. Market participants will receive the preliminary University of Michigan Consumer Sentiment reading (Briefing.com consensus 60.0; prior 58.2) for… Read More
Headline News: The S&P 500 futures are down 7 points and are trading 0.7% below fair value. The Nasdaq 100 futures are down 43 points and are trading 0.9% below fair value. The Dow Jones Industrial Average futures are down 4 points and are trading 0.3% below fair value. Equity futures are mixed, and little changed this morning. Market participants are in wait-and-see mode in front of a heavy slate of economic data this morning that includes August Retail Sales and weekly initial jobless claims. Reports indicate that rail companies and unions came to a tentative agreement to avoid a strike that would have begun at midnight tonight. In central bank news, the PBOC left its key interest rates unchanged. European Central Bank policymaker De Guindos acknowledged that price pressures in the eurozone have continued strengthening and broadening, while policymaker Kazaks said that rates might have to continue rising after February to get inflation back to the 2.0% target. Treasury yields are on the rise, with the 2-yr note yield up six basis points to 3.83% and the 10-yr note yield up three basis points to 3.45%. Energy complex futures are making downside moves. WTI crude oil futures are down… Read More
Headline News: The S&P 500 futures are down 6 points and are trading 0.7% below fair value. The Nasdaq 100 futures are down 23 points and are trading 0.8% below fair value. The Dow Jones Industrial Average futures are down 55 points and are trading 0.5% below fair value. Equity futures are modestly weaker as participants weigh concerns over the Fed raising rates higher than expected for longer than expected and the potential for a hard landing. This comes ahead of another inflation reading out later this morning, the August PPI release. Overseas, there was some speculation that the Bank of Japan is preparing to intervene in the currency market to slow the yen’s depreciation against the dollar. The MBA Mortgage Application Index fell 1.2% compared to last week. Purchase applications rose 0.2%, while refinancing applications fell 4.0%. Other economic data released today includes August PPI (Briefing.com consensus -0.1%; prior -0.5%) and core PPI (Briefing.com consensus +0.3%; prior +0.2%) at 8:30 a.m. ET and EIA Crude Oil Inventories (prior +8.84 million) at 10:30 a.m. ET. Treasury yields are on the rise this morning, with the 2-yr note yield up seven basis points to 3.83% and the 10-yr note yield up… Read More
Headline News: Stock futures dropped on Tuesday morning after an August inflation report came in hotter than expected. Dow Jones Industrial Average futures sank 406 points or about 1.3%. S&P 500 futures fell 1.7% and Nasdaq 100 futures slid 2.3%. The August consumer price index report showed a higher-than-expected reading for inflation. Headline inflation rose 0.1% month over month, even with falling gas prices. Core inflation rose 0.6% month over month. Economists surveyed by Dow Jones had been expecting a decline of 0.1% for overall inflation, with a rise of 0.3% for core inflation. (Jesse Pound and Carmen Reinicke: CNBC) Markets: The S&P 500 rallied for the fourth day and closed higher at 4110.41 and above resistance at 4079.22. So far this morning, the index has a suggested open of 4050.50 or -1.73% after the release of the August CPI. That would have the index open below support, and the 50-day moving average at 4036.89 will become possible support. If the selling picks up during the day, that 50 -day moving could be taken out just two days after being breached. So, caution is warranted today with any new buys. We are currently Intermediate-term bearish and short-term bullish. John… Read More
Headline News: The S&P 500 futures are up 23 points and are trading 0.6% above fair value. The Nasdaq 100 futures are up 84 points and are trading 0.7% above fair value. The Dow Jones Industrial Average futures are up 113 points and are trading 0.3% above fair value. Equity futures indicate a higher open driven by carryover momentum following last week’s rebound effort. There’s also some hesitation ahead of tomorrow’s August CPI report at 8:30 a.m. ET. The White House is expected to tighten restrictions on semiconductor chip exports to China, according to Reuters. In central bank news, there’s some speculation that China will lower its medium-term lending facility rate. European Central Bank policymakers are reportedly preparing to raise the key rate to 2.00% with some lobbying for restrictive policy. ECB policymaker Nagel said that clearer steps would need to be taken if inflation doesn’t ease, adding that it could exceed 10.0% at its peak, which is expected in December. Energy complex futures are making upside moves this morning. WTI crude oil futures are up 0.8% to $87.52/bbl. Natural gas futures are up 1.2% to $8.09/mmbtu. The US Dollar Index is down 0.8% to 108.13. The 2-yr Treasury note… Read More
Headline News: The S&P 500 futures are up 29 points and are trading 0.7% above fair value. The Nasdaq 100 futures are up 120 points and are trading 0.9% above fair value. The Dow Jones Industrial Average futures are up 197 points and are trading 0.6% above fair value. The equity futures market has a decidedly positive bias, with carryover momentum from recent gains driving the upside. Other support factors include softer-than-expected CPI and PPI readings out of China, a weakening dollar, better-than-expected results and guidance from DocuSign (DOCU), and bearish investor sentiment readings that are acting as a contrarian catalyst. The US Dollar Index is down 0.7% to 108.94. EUR/USD is up 0.6% to 1.0054. USD/JPY is down 1.1% to 142.55 after BOJ Governor Kuroda said rapid moves in the yen are not desirable. At the same time, cryptocurrencies are in rally mode with the risk-on sentiment. The 2-yr Treasury note yield is flat at 3.49%, while the 10-yr note yield is down two basis points to 3.27%. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 rallied again, closing higher at 4006.18, and looks set to test the critical 50-day moving average. However, the… Read More
Headline News: The S&P 500 futures are down 2 points and are trading in line with fair value. The Nasdaq 100 futures are down 18 points and are trading 0.2% below fair value. The Dow Jones Industrial Average futures are up 4 points and are trading slightly above fair value. Equity futures are not doing much this morning. It’s a bit of a wait-and-see trade with market participants looking to see if the market can build on yesterday’s gain. Participants also await the ECB decision and Fed Chair Powell’s discussion at the Cato Institute’s 40th Annual Monetary Conference later this morning. In overseas news, British Prime Minister Truss announced that a fracking ban will be lifted and that household energy bills will be limited to GBP2,500 per annum for the next two years. Japan’s Q2 GDP was better-than-expected at 3.5% year-over-year from the last reading of 2.2% year-over-year. Japan’s deputy chief cabinet secretary said that the yen’s movement is being watched with a strong sense of urgency. USD/JPY -0.2% to 143.46. Energy complex futures are mixed after yesterday’s sell-off. WTI crude oil futures are up 0.2% to $82.06/bbl. Natural gas futures are down 0.2% to $7.82/mmbtu. Treasury yields are lower… Read More
Headline News: The S&P 500 futures are up 24 points and are trading 0.6% above fair value. The Nasdaq 100 futures are up 76 points and are trading 0.6% above fair value. The Dow Jones Industrial Average futures are up 186 points and are trading 0.6% above fair value. Equity futures are positive after last week’s selling. There’s a lingering feeling the market may be due for a bounce from a short-term oversold condition. There’s some central bank news in the mix. The Reserve Bank of Australia raised its cash target rate by 50 basis points to 2.35%, as expected, and said more rate hikes are likely but won’t be on a pre-set path. A focal point this week will be the ECB meeting on Thursday and whether the central bank raises its key policy rate by 50 basis points or 75 basis points. According to The Wall Street Journal, Russia has indicated that the shutdown of the Nord Stream 1 pipeline will be long-lasting. On a related note, OPEC+ is implementing a small production cut of 100,000 barrels per day. Energy complex futures are trending lower, with WTI crude oil futures down 0.2% to $86.68/bbl. Natural gas futures are… Read More
Headline News: The S&P 500 futures are up 1 point and are trading slightly above fair value. The Nasdaq 100 futures are down 3 points and are trading slightly below fair value. The Dow Jones Industrial Average futures are up 4 points and are trading slightly above fair value. Market participants lack conviction in the premarket trade, with equity futures mixed ahead of the August Jobs Report at 8:30 a.m. ET. Overseas, Chinese tech hub Shenzhen is extending Covid curbs on public activities but stopped short of a full lockdown, according to Reuters. Energy complex futures are mixed with WTI crude oil futures up 1.7% to $88.09/bbl, while natural gas futures are down 3.1% to $8.98/mmbtu. Treasury yields are modestly lower, with the 2-yr note yield down six basis points to 3.47%. The 10-yr note yield is down one basis point to 3.25%. The closely watched August Jobs Report includes: Nonfarm Payrolls (Briefing.com consensus 300,000; prior 528,000), Nonfarm Private Payrolls (Briefing.com consensus 280,000; prior 471,000), Average Hourly Earnings (Briefing.com consensus 0.4%; prior 0.5%), Unemployment Rate (Briefing.com consensus 3.5%; prior 3.5%), and Average Workweek (Briefing.com consensus 34.6; prior 34.6). At 10:00 a.m. ET, July Factory Orders (Briefing.com consensus 0.2%; prior 2.0%)… Read More
Headline News: The S&P 500 futures are down 13 points and are trading 0.4% below fair value. The Nasdaq 100 futures are down 63 points and are trading 0.6% below fair value. The Dow Jones Industrial Average futures are down 61 points and are trading 0.2% below fair value. General concerns about slowing growth, rate hikes, and inflation are fueling carryover negativity from recent sessions. Weakness this morning comes after several days of trying to stage a rebound that then gets sold into. Some macro headlines this morning add fuel to the existing concerns, including news that China locked down Chengdu (21.2 million population) for COVID testing. China also had a weak August Caixin Manufacturing PMI, which came in below 50.0, indicating contraction. In Europe, August Manufacturing PMI from Germany, the UK, France, Spain, and the Eurozone all showed contraction with below-50.0 readings. Sentiment is also pressured by news that the US government will restrict sales of semiconductors to Russia and China, bringing down some semiconductor names in premarket action. Energy complex futures are trending lower. WTI crude oil futures are down 1.4% to $88.26/bbl. Natural gas futures are down 0.4% to $9.09/mmbtu. (Michael Gibbs, Director of Equity Portfolio & Technical… Read More
