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 66 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. The stock market is poised for a lower open after yesterday’s flattish finish. Continued softness in regional bank stocks coupled with nervousness about the debt ceiling has contributed to the negative bias this morning. This comes ahead of President Biden’s meeting with Congressional leaders about the debt ceiling today at 4:00 p.m. ET. Market participants are also digesting some tepid trade data out of China. The trade surplus rose to $90.21 billion in April (expected surplus of $71.60 bln; prior surplus of $88.19 bln), with imports falling 7.9% year/year (expected -5.0%; prior -1.4%) while exports rose 8.5% (expected 8.0%; last 14.8%). Treasury yields are little changed from yesterday’s settlement levels. The 2-yr note yield is unchanged at 3.99%, and the 10-yr note yield is down three basis points to 3.49%. The U.S. Dollar Index is up 0.3% to 101.66. Energy complex futures are giving back some of yesterday’s gains. WTI crude… Read More
Headline News: The S&P 500 futures are up 7 points and are trading 0.2% above fair value. The NASDAQ 100 futures are down 6 points and are trading slightly fair value. The Dow Jones Industrial Average futures are up 78 points and are trading 0.2% above fair value. Stock futures have been mixed this morning, yet skew somewhat more positive. Market participants are waiting to see if there will be any follow-through on Friday’s rally. This week also brings another batch of potentially market-moving events. Namely, the Senior Loan Officer Opinion Survey will be released today, the Consumer Price Index (CPI) on Wednesday, and the Producer Price Index (PPI) on Thursday. Treasury Secretary Janet Yellen warned of “economic chaos” if the debt ceiling is not raised, according to CNBC. This comes ahead of President Biden’s meeting with House Speaker McCarthy and other Congressional leaders on May 9. The 2-yr note yield is up five basis points to 3.96%, and the 10-yr note yield is up three basis points to 3.46%. Oil prices are sharply higher, up 2.8% to $73.32/bbl. Economic data today is limited to the Wholesale Inventories report for March (Briefing.com consensus 0.1%; prior 0.1%) at 10:00 a.m. ET.… 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 88 points and are trading 0.7% above fair value. The Dow Jones Industrial Average futures are up 180 points and are trading 0.5% above fair value. Stock futures have a positive disposition, boosted by a decent earnings-related gain in a large tech company along with rebound price action in regional bank stocks after sharp declines recently. Investors are eagerly anticipating a potentially market-moving April Employment Report at 8:30 a.m. ET. Treasury yields are moving higher as the flight to safety trade unwinds somewhat. The 2-yr note yield is up nine basis points to 3.83% and the 10-yr note yield is up six basis points to 3.41%. The U.S. Dollar Index is flat at 101.39. Oil prices are reclaiming lost ground, trading back above $70.00/bbl, up 2.7% to $70.42/bbl. (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P 500 sold off for a fourth day and moved below support to close lower at 4061.22. The index is now at the lower Bollinger Band and just above possible support at the 50-day moving average (4039.20). The… Read More
Headline News: The S&P 500 futures are down 14 points and are trading 0.3% below fair value. The Nasdaq 100 futures are down 10 points and are trading slightly below fair value. The Dow Jones Industrial Average futures are down 118 points and are trading 0.3% below fair value. Stock futures are weak on the heels of yesterday’s FOMC decision and with concerns over the regional bank industry back at the fore. Relative strength in some mega-cap stocks is offering some support to the Nasdaq 100 futures, presumably driven by some flight to safety buying interest. The Hong Kong Monetary Authority followed the FOMC rate hike with a 25-bps increase to 5.50%, and the Norges Bank raised its deposit rate by 25 bps to 3.25%, as expected. The European Central Bank is also expected to raise its key lending rates at 8:15 ET. Treasury yields are sharply lower. The 2-yr note yield is down 15 basis points to 3.80%, and the 10-yr note yield is down four basis points to 3.35%. Market participants will receive the following economic data today: 8:30 ET: Preliminary Q1 Productivity (Briefing.com consensus -0.1%; prior 1.7%), preliminary Q1 Unit Labor Costs (Briefing.com consensus 3.9%; prior 3.2%),… Read More
Headline News: The S&P 500 futures are down 7 points and are trading 0.2% below fair value. The Nasdaq 100 futures are down 9 points and are trading slightly below fair value. The Dow Jones Industrial Average futures are down 81 points and are trading 0.2% below fair value. Stock futures have a somewhat negative bias, but moves are narrow. There’s a lot of news to digest this morning that has limited investor conviction at this juncture. Treasury Secretary Yellen warned that the debt ceiling could be hit as early as June 1. President Biden will meet with House Speaker Kevin McCarthy and other congressional leaders on May 9 to discuss the debt ceiling. The Reserve Bank of Australia unexpectedly raised its cash rate by 25 bps to 3.85%. Manufacturing PMIs from the eurozone, Germany, France, Italy, Spain, and the U.K. for April were all down from the March readings. Core CPI from the eurozone was slightly better than expected at 1.0% month/month (expected 1.1%). The 2-yr note yield up one basis point to 4.13%. 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 rallied… Read More
Headline News: The S&P 500 futures are down 4 points and are trading slightly below fair value. The NASDAQ 100 futures are down 15 points and are trading 0.1% below fair value. The Dow Jones Industrial Average futures are down 14 points and are trading slightly below fair value. Stock futures are flattish as investors await key events later this week, including the FOMC decision on Wednesday, the ECB meeting, and the April Employment Report on Friday. At 10:00 a.m. ET, market participants will receive the April ISM Manufacturing Index (Briefing.com consensus 46.8%; prior 46.3%). This comes after China reported weaker-than-expected PMI data for April (actual 49.2; expected 51.4). Other U.S. economic data today includes the final IHS Markit Manufacturing PMI (prior 50.4) for April at 9:45 a.m. ET and the Construction Spending report (Briefing.com consensus +0.1%; prior -0.1%) for March at 10:00 a.m. ET Treasuries are little changed from Friday’s settlement levels. The 2-yr note yield is unchanged at 4.06%, and the 10-yr note yield is up one basis point to 3.46%. The U.S. Dollar Index is up 0.2% to 101.83. Energy complex futures are moving lower. WTI crude oil futures are down 2.1% to $75.14/bbl, and natural gas… Read More
Headline News: The S&P 500 futures are down 18 points and are trading 0.5% below fair value. The Nasdaq 100 futures are down 50 points and are trading 0.4% below fair value. The Dow Jones Industrial Average futures are down 143 points and are trading 0.3% below fair value. Stock futures are weaker this morning after yesterday’s welcome, and perhaps overdone, rally effort. Amazon.com (AMZN) has been a notable drag on sentiment, retreating after beating earnings estimates but disappointing investors with its cloud-computing outlook. There was also some weak economic data from Europe that has stoked global slowdown concerns. Briefly, GDP growth in Q1 was slower than expected in the eurozone (actual 0.1% qtr/qtr; expected 0.2%) and Germany (actual -0.1% qtr/qtr; expected 0.3%), while Consumer Price Index data from France (actual 0.6% m/m; expected 0.4%) reflected accelerating inflation in April. Separately, the Bank of Japan made no changes to its yield curve control policy. Treasury yields moving lower with global growth concerns back in play. The 2-yr note yield is down two basis points to 4.07%, and the 10-yr note yield is down five basis points to 3.48% (Michael Gibbs, Director of Equity Portfolio & Technical Strategy) Markets: The S&P… Read More
Headline News: The S&P 500 futures are down 19 points and are trading 0.5% below fair value. The Nasdaq 100 futures are down 53 points and are trading 0.4% below fair value. The Dow Jones Industrial Average futures are down 100 points and are trading 0.3% below fair value. Stock futures are weak this morning despite some pleasing earnings and/or guidance from the likes of McDonald’s (MCD), PepsiCo (PEP), and General Motors (GM). Strength from these names has not been enough to offset the fallout in First Republic Bank (FRC). FRC’s earnings report brought worries about the bank industry back to the forefront, along with Standard Chartered CEO’s warning that the banking sector may have other issues that could “come home to roost in some form of a crisis,” according to CNBC. Tempered sales guidance from UPS, which it attributed in part to changing consumer behavior, has also contributed to this morning’s negative disposition by fostering concerns about broader economic growth and earnings prospects. The 2-yr note yield is down seven basis points to 4.07%, and the 10-yr note yield is down seven basis points to 3.45%. Separately, President Biden announced his reelection campaign. (Michael Gibbs, Director of Equity Portfolio &… Read More
Headline News: The S&P 500 futures are down 3 points and are trading roughly in line with fair value. The Nasdaq 100 futures are down 8 points and are trading slightly below fair value. The Dow Jones Industrial Average futures are down 30 points and are trading slightly below fair value. Stock futures are somewhat mixed, and little changed in front of a heavy week of earnings. Investors are eyeing potentially market-moving reports from Alphabet (GOOG) and Microsoft (MSFT) after the close of April 25, Meta Platforms (META) after the close of April 26, and Amazon.com (AMZN) after the close of April 27. Also, First Republic Bank (FRC), which was in the middle of some of the bank industry fallout, reports earnings after the close today. House Speaker Kevin McCarthy said the House would vote on a debt ceiling bill this week, and he believes it will pass the chamber, according to Reuters. This bill will be dead on arrival in the Senate due to Democratic opposition. Many GOP lawmakers are prepared to let a default happen, according to the Washington Post. The 2-yr Treasury note yield is unchanged at 4.17%, and the 10-yr note yield is down three basis… Read More
Headline News: The S&P 500 futures are down 7 points and are trading 0.2% below fair value. The Nasdaq 100 futures are down 56 points and are trading 0.4% below fair value. The Dow Jones Industrial Average futures are down 24 points and are trading slightly below fair value. Futures for the equity market skew slightly negative on this options expiration day. The downward bias stems from some disappointment that the S&P 500 has had a lackluster showing during the early stages of earnings season and has been unable to make a run at the 4,200 level with any conviction. Also, there is some trepidation ahead of earnings results next week from the mega cap stocks. The Shanghai Composite dropped 2.0% today following a Bloomberg report that the PBOC might start dialing back the stimulus it provided during depths of COVID pandemic. There is also some speculation that China is going to tighten restrictions on technology companies. Flash Services PMI readings from Germany, France, and the U.K. improved, coming in above expectations, but Manufacturing PMI readings from all three countries slipped deeper into contraction. U.S. economic data today is limited to the preliminary IHS Markit Manufacturing PMI (prior 49.2) and… Read More
