Headline News: The S&P 500 futures trade 22 points, or 0.5%, below fair value as Treasury yields continue to push higher in front of a consequential week for economic data and earnings reports. The tech-heavy Nasdaq 100 futures underperform and trade 1.1% below fair value. The 2-yr yield is currently up five basis points to 2.57%, and the 10-yr yield is up another four basis points to 2.76% after rising 34 basis points last week. The rapid rise in long-term rates has undercut the growth stocks within the Nasdaq for valuation reasons. Other negative factors for sentiment include record-high COVID-19 cases in Shanghai that has kept residents in lockdown mode, uncertainty surrounding France’s presidential election runoff on April 24, the Russia-Ukraine situation, and a recognition that the S&P 500 closed below its 200-day moving average (now 4494) last Friday. Interestingly, WTI crude futures have slipped below $94 per barrel ($93.66, -4.60, -4.7%) amid the Shanghai lockdowns, the joint effort among IEA nations to release oil from strategic reserves, and some weakening price momentum. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 failed to breakout past resistance at 4522.00, sold off below the 200-day moving average at… Read More
Headline News: The equity futures market is extending yesterday’s losses, as interest rates continue to rise amid rate-hike/inflation concerns. The S&P 500 futures trade 36 points, or 0.8%, below fair value while the tech-heavy Nasdaq 100 futures trade 1.4% below fair value. Specifically, the 10-yr yield is up eight basis points to 2.63% after starting the month at 2.33%, and the 2-yr yield is up four basis points to 2.55% after starting the month at 2.28%. Treasury yields are at multi-year highs, as is the U.S. Dollar Index (99.50, +0.03, unch). After hawkish-sounding Fed commentary yesterday fueled the rise in interest rates, investors will pay heed to the FOMC Minutes from the March meeting at 2:00 p.m. ET. On a related note, Philadelphia Fed President Harker (alternate FOMC voter) will speak at 9:30 a.m. ET. Earlier this morning, the weekly MBA Mortgage Applications Index fell 6.3% following a 6.8% decline in the prior week. WTI crude futures are up 1.6%, or $1.57, to $103.54/bbl ahead of the weekly EIA crude inventory report at 10:30 a.m. ET (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 sold off and briefly undercut support at 4522.00 and closed at 4525.12.… Read More
Headline News: The S&P 500 futures trade roughly in-line with fair value in a relatively quiet session. Investors are waiting for key data on the services sector, speeches from several Fed officials, and any new sanctions against Russia for its alleged war crimes. The Treasury market remains a focal point, as the 2s10s spread has un-inverted. The 2-yr yield is up four basis points to 2.46% amid rate-hike expectations, and the 10-yr yield is up five basis points to 2.46% amid inflation expectations. Oil prices are still trading over $100 per barrel ($103.75, +0.47, +0.5%) while the U.S. Dollar Index (98.94, -0.06, -0.1%) is weaker. On the data front, investors will receive the Trade Balance for February (Briefing.com consensus -$88.5 billion) at 8:30 a.m. ET and the ISM Non-Manufacturing Index for March (Briefing.com consensus 58.5%) at 10:00 a.m. ET. Today’s lineup of Fed speakers includes Minneapolis Fed President Kashkari (alternate voter) at 10:00 a.m. ET, Fed Governor Brainard (FOMC voter) at 11:05 a.m. ET, and New York Fed President Williams (FOMC voter) at 2:00 p.m. ET. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 traded higher on average volume of 2,275,884,800 and closed at 4582.64. The… Read More
Headline News: The S&P 500 futures trade 11 points, or 0.2%, above fair value to start the week, as the market continues to weather a host of growth-related concerns. Some of those concerns include the prolonged Russia-Ukraine situation, the COVID lockdowns in Shanghai, the potential for a Fed policy mistake, the 2s10s spread inversion, supply chain disruptions, and an inflationary environment that includes $100/bbl oil prices ($100.29, +1.02, +1.0%). The Treasury market is trading little changed, although the 30- yr yield has risen four basis points to 2.46% after dropping 18 basis points last week. The 2-yr yield is unchanged at 2.43%, and the 10-yr yield is up one basis point to 2.39%. The U.S. Dollar Index is up 0.3% to 98.88. Today’s economic data will be limited to Factory Orders for February (Briefing.com consensus -0.6%), which will be released at 10:00 (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: On Friday, the S&P 500 rallied late in the day past resistance at 4522.00 and closed higher at 4545.86. We feel the two-day selloff was enough of a break that buyers could potentially come back into the market and continue the recent uptrend. Potential resistance remains at 4509.03, and… Read More
Headline News: The S&P 500 futures trade five points, or 0.1%, below fair value as the market takes a breather amid tempered hopes for a ceasefire. Russia has refuted a breakthrough in talks with Ukraine, reportedly continuing its attacks near Kyiv despite promising to reduce military operations, according to Bloomberg. Foreign policy analysts have said that Russia is employing a tactical shift to focus on two eastern provinces. The market, though, doesn’t seem too concerned about that situation right now based on the slightly negative bias in the futures market. It appears more likely that the futures market is taking a pause after the S&P 500 rallied 11.0% since March 14.. On the data front, investors will receive the ADP Employment Change report for March (Briefing.com consensus 440,000) at 8:15 a.m. ET and the third estimate for Q4 GDP (Briefing.com consensus 7.1%) at 8:30 a.m. ET. The weekly MBA Mortgage Applications Index fell 6.8% following an 8.1% decline in the prior week. The Treasury yield curve is widening a bit after a brief inversion of the 2s10s spread yesterday. The 2-yr yield is down two basis points to 2.33% while the 10-yr yield is up one basis point to 2.41%.… Read More
Headline News: The S&P 500 futures trade 29 points, or 0.6%, above fair value amid positive momentum and continuing hope that Russia and Ukraine can reach a ceasefire soon. Negotiators from both sides will resume peace talks in Turkey today, meeting face-to-face for the first time in over two weeks, according to Reuters. Ukraine is hopeful for a ceasefire, but U.S. officials continue to express their doubts about Russia’s intentions. Strikingly, the 2s10s spread in the Treasury market has now compressed to within ten basis points, stoking speculation of a recession down the road should there be an inversion. That hasn’t bothered the futures market, though, which is appearing more optimistic about the near-term outlook. The 2-yr yield is up ten basis points to 2.44%, and the 10-yr yield is up four basis points to 2.52%. The U.S. Dollar Index is down 0.3% to 98.78 amid relative strength in the euro, which is up 0.5% to 1.1039 amid hope for a ceasefire. WTI crude is down 0.2% to $105.71/bbl. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 rallied again, closing at 4575.52, and is now just under potential resistance at 4590.03. However, the volume during the… Read More
Headline News: The S&P 500 futures trade 18 points, or 0.4%, above fair value to start the week amid a carryover of positive momentum. Ostensibly, weaker oil prices ($108.09, -5.81, -5.1%) are helping risk sentiment, although they’re down on growth concerns after Shanghai imposed lockdowns to curb an outbreak of COVID-19. China’s Shanghai Composite eked out a 0.1% gain on Monday. The Treasury market is also reflecting growth concerns by way of curve-flattening activity. The 2-yr yield is up two basis points to 2.31%, while the 10-yr yield is down two basis points to 2.47%. The U.S. Dollar Index is up 0.5% to 99.25 amid relative weakness in the Japanese yen, which is down 1.6% against the dollar after the Bank of Japan offered to buy an unlimited amount of JGBs at 0.25%. That move was consistent with the central bank’s policy of yield curve control. In key corporate news, Apple (AAPL 172.84, -1.88, -1.1%) is planning to cut production for the iPhone SE by roughly 20% and AirPods by more than 10 million units this year amid geopolitical uncertainty, according to TheNikkei. Tesla (TSLA 1067.50, +56.86, +5.6%) will ask shareholders to authorize additional shares to enable another stock split.… Read More
Headline News: The stock market is on track for a higher start as futures on the S&P 500 trade 29 points above fair value. Barring an early reversal, the market will look to rebound from a midweek dip that returned the S&P 500 back below its 200- day moving average (4474). Overnight action saw a mostly lower showing from markets in Asia while European markets trade near their flat lines. President Biden is meeting with NATO allies in Europe with reports suggesting that more sanctions against Russia will be announced. Crude oil holds a modest loss, slipping $0.63, or 0.6%, to $114.30/bbl. Treasuries are on track to give back yesterday’s gains at the open, as the 10-yr yield rises five basis points to 2.37%. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 sold off below support at 4474.19 and closed lower at 4456.24. The selling came on low volume with only 2,174,320,384 shares traded, and RSI turned down, closing at 55.57. Some profit-taking at these leaves was expected and normal after a rally five out of the last six trading days. We feel the index can reclaim the 200-day moving average today and start to build… Read More
Headline News: The stock market is on track for a lower start as futures on the S&P 500 trade 13 points below fair value. The modest weakness in equity futures comes alongside selling in most European markets. President Biden is traveling to Europe today to meet with NATO allies. German Chancellor Scholz said that while his country plans to phase out the use of Russian oil, the change cannot be made overnight. Crude oil is up $2.47, or 2.3%, at $111.74/bbl. Economic data released overnight showed the U.K.’s yr/yr CPI rate rising to 6.2%, its fastest pace of growth in nearly 30 years. In the U.S., the weekly MBA Mortgage Index fell 8.1% after decreasing 1.2% a week ago. The only remaining report on today’s schedule is the February New Home Sales report (Briefing.com consensus 820,000; prior 801,000), which will be released at 10:00 E.T. Treasuries trade near their flat lines, with the 10-yr yield unchanged at 2.37%. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 surprised us by moving past and closing at 4511.61 above the 200-day at 4473.04. The current uptrend has been impressive, but the Advance/Decline Line and the Net new high index… Read More
Headline News: The stock market is on track for a higher start as futures on the S&P 500 trade 20 points above fair value, which will give the benchmark index another chance at reclaiming its 200-day moving average. The early gains in equity futures follow an overnight session that saw a mostly positive showing from Asian equities while European stocks are on the rise. Commodities trade on a mostly lower note after yesterday’s gains, with crude oil down $0.10, or 0.1%, at $112.02/bbl. The overnight session saw a limited set of economic data, while the U.S. session will not feature any noteworthy releases. Treasuries are on track for a lower start, with the 10-yr yield rising two basis points to 2.34%. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 traded up to the 200-day moving average, failed to breakthrough, and closed flat on the day. The index traded down to the 50-day moving average and rallied, so we feel the index might trade between the two moving averages today before continuing the recent uptrend. RSI is still supportive of the uptrend and remains above the 50 level. If selling should come in today, the possible support… Read More
