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December 11, 2019
Market participants still don’t know for sure if the tariffs on the final tranche of imported Chinese goods will go into effect December 15 and they are also waiting to hear (even though they have a good idea already) what Fed Chair Powell has to say at today’s press conference to shed light on what the FOMC is thinking about the economic outlook and the policy rate path.
December 9, 2019
It’s just your typical Monday. Taking things from the top, China reportedly wants to get a trade deal worked out as soon as possible; there is some M&A buzz in the biotech space with ArQule (ARQL) and Synthorx (THOR) being taken out at huge premiums; worries about repo market functioning at year end are said to be festering; and there is a lot of interest in macro matters later in the week.
December 5, 2019
The U.S. and China are maintaining close communication. That’s the word from China’s Commerce Ministry and that is somehow making a lot of U.S. companies more valuable today even though it effectively means nothing.
December 2, 2019
For the stock market, the weather remains pretty temperate. Trade winds have been blowing in a mostly favorable direction, central banks continue to blow hot air into the market with accommodative policies, and economic data have been offering some signs of early spring as it relates to the 2020 growth outlook — growth being the operative word.
November 20, 2019
The futures for the major indices are pointing to a lower open, but if recent trading action is any indication, there is probably not a lot of undue concern about that indication. There won’t be either until the cash market demonstrates it is truly bothered by negative news.
November 18, 2019
The tweet in question was posted by China-based CNBC reporter Eunice Yoon, who said a government source informed her that the mood in Beijing about a trade deal is pessimistic because President Trump isn’t endorsing a tariff rollback. China’s strategy, therefore, is to talk now but wait due to the impeachment, U.S. election, and to prioritize China economic support.
November 14, 2019
The stock market might still be inclined to think a trade deal of some kind will come to fruition with China, but given the recent headlines, it has to respect the possibility at least that one won’t. That mindfulness helps explain the slowdown of late in the breakout effort.
November 11, 2019
U.S. futures have pulled back modestly from all-time highs, as investors continue to monitor U.S. trade negotiations and developments overseas. The S&P 500 futures trade 13 points, or 0.4%, below fair value in a profit-taking trade. There was no meaningful progress on the trade front over the weekend after President Trump said he had yet to agree to roll back tariffs on Friday.
November 6, 2019
The stock market seems to be in a wash-rinse-repeat reaction mode, as it is indicated to open higher on the same spin cycle that has driven the Dow, Nasdaq, and S&P 500 to record-high levels. In brief, there is optimism about positive-sounding U.S. China trade negotiations; there is optimism that the growth outlook is better than feared…
November 4, 2019
The S&P 500 and Nasdaq Composite closed at a record high last week. They will open at an even higher high today, too, and this time they will have company in record territory, as the Dow Jones Industrial Average is poised to join them. Currently, the S&P 500 futures are up 18 points and are trading 0.6% above fair value.
October 28, 2019
The major indices appear to be headed higher when the opening bell rings and likely into record territory for the S&P 500. Currently, the S&P futures are up 13 points and are trading 0.4% above fair value. The Nasdaq 100 futures are up 38 points and are trading 0.5% above fair value. The Dow Jones Industrial Average futures are up 137 points and are trading 0.5% above fair value.
October 24, 2019
During an earnings-reporting period, you can always count on at least one day to be filled with information overload. Today is one of those days. There have been a ton of earnings reports since yesterday’s close, so be sure to check out our Earnings Results calendar page for the full rundown.
October 21, 2019
The S&P 500 is on track to extend its two-week advance at the open as the futures tied to the benchmark index trade 16 points, or 0.5%, above fair value. Some of last week’s earnings-driven momentum is carrying over to today’s futures trade despite continued weakness in Boeing (BA 334.40, -9.60, -2.8%) and a delayed Brexit vote.
October 15, 2019
It is a busy morning, and for a change it doesn’t have as much to do with trade deal news as it does with earnings news. Be that as it may, there is no escaping trade deal news.
October 8, 2019
It is not going to be a good open for the stock market. The futures for the major indices are trading noticeably lower, undercut by — what else — anxiety about trade dealings with China.
October 7, 2019
We would be careful about reading too much into the futures market ahead of the open. It is presaging a lower start, but that’s all it is presaging. Beyond the opening bell, anything can happen for this fickle market, which is nervous one moment and confident the next. More often than not, trade matters are the bridge between those two extremes.
October 2, 2019
In discussing yesterday’s positive, pre-opening bias in the futures trade, we suggested things could change in the wake of the release of the ISM Manufacturing Index for September if it was weaker than expected. Well, it was, as it registered a 10-year low reading of 47.8%. Following that print, things did change in the market.
October 1, 2019
The early read of things is that the stock market should start today’s session on a higher note. The futures for the major indices are trading 0.3% to 0.4% above fair value. There is some carryover action from Monday, including leadership from Apple (AAPL), which is indicated 0.6% higher on no news, and some weakish final manufacturing PMI readings for September out of Japan and the eurozone.
September 26, 2019
The impeachment inquiry might be clouding the political outlook, but it doesn’t appear to be clouding the stock market’s bullish bias. The major indices turned in a solid performance on Wednesday, keying on the impressive new home sales data for August, and a remark from the president that a trade deal with China “could happen sooner than you think,” to maintain its hopeful vision of U.S. growth prospects.
September 23, 2019
There isn’t a great deal of change in the futures market, which is a bit interesting, only because the news that reportedly drove a retreat in Friday’s session was dismissed over the weekend as not being news of any real concern.The press is reporting that the cancellation of the farm visits in Montana by the Chinese delegation should not have been construed as a sign of a breakdown in deputy-level talks ahead of next month’s meeting among senior trade officials in Washington. Furthermore, officials in the U.S. and China called last week’s talks “productive” and “constructive,” respectively.
September 18, 2019
Today is an FOMC policy decision day, which means early indications don’t hold much water. Having said that, there are a few leaks in pre-market trading. Currently, the S&P futures are down three points and are trading 0.1% below fair value. The Nasdaq 100 futures are down ten points and are trading 0.1% below fair value. The Dow Jones Industrial Average futures are down 23 points and are trading 0.1% below fair value.
September 16, 2019
The geopolitical backdrop got more tense over the weekend; the global economic backdrop presumably got worse; and the corporate earnings outlook got cloudier. With all of that in mind, it is remarkable how nonplussed the futures market looks this morning. Granted the S&P futures are down ten points and are trading 0.4% below fair value, but now stop to consider this morning’s lead headlines…
September 11, 2019
The first few sessions this week have been about unwinding and grinding. The unwinding has occurred in the Treasury market and high-multiple growth stocks while the grinding has occurred in the broader market, which has stood its ground with the help of a rotation into value-oriented stocks.
September 9, 2019
There is a hodgepodge of headline considerations this morning, yet there hasn’t been any change in the underlying tone of the market. It remains bullish, as it has been for the last two weeks. Currently, the S&P futures are up 10 points and are trading 0.4% above fair value. The Nasdaq 100 futures are up 24 points and are trading 0.3% above fair value. The Dow Jones Industrial Average futures are up 62 points and are trading 0.3% above fair value.
September 6, 2019
The futures market was up before the release of the Employment Situation Report for August. Ostensibly, the news that the People’s Bank of China announced a 50-basis points cut in the required reserve ratio for China’s banks, effective September 16, was the catalyst, yet that cut was expected.
September 5, 2019
The futures for the major indices are up sharply this morning and one doesn’t have to make an extra effort to determine the cause. The cause is the news that the U.S. and China have agreed to hold trade negotiations in Washington in early October.
September 3, 2019
Heading into the Labor Day holiday, market participants were hoping the holiday weekend would be made more festive by a tweet from President Trump announcing a delay in the increased tariffs set for September 1. There was no such tweet. That realization, and some other developments, has set the tone for a negative start today. Currently, the S&P futures are down 19 points and are trading 0.7% below fair value.
August 29, 2019
Here we go again. Trade words are speaking louder than actions and are adding billions of dollars to market capitalizations without any fundamentally altered reason for that to be the case. Call it a pre-determined response to how this market (and algorithms) works. The call to formulaic action was made by China’s Commerce Minister Gao, who reiterated that China is “willing to solve the problem through consultation and cooperation with a calm attitude, but firmly opposes escalation of trade war,” according to a Bloomberg report.
August 26, 2019
It hasn’t been a dull start to the week — and the week hasn’t even started for the cash market. On the contrary, the futures market has been full of excitement, which could also be construed as misdirection given the purported catalyst for a spike in the futures for the major indices.
August 22, 2019
The futures market appears to be riding an interest rate seesaw again this morning, moving lower when Treasury yields were moving lower and moving higher when Treasury yields are moving higher (as they are now).
