Aug 30, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“Logic will get you from A to Z; imagination will get you everywhere.” – Albert Einstein
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
After two days of losses, futures have made an attempt to rally today, but as the opening bell approaches, the rally has lost some steam. Treasury yields are still lower on the day as the 10-year yield remains below 3.10%, while crude oil is down over 2%. On the economic calendar this morning, we’ll be getting house price levels from the FHFA (for June) at 9 AM Eastern and then Consumer Confidence and JOLTS at 10 AM.
It seems these days that the market is solely focused on the Fed, but at the individual stock level, it’s Bed Bath & Beyond (BBBY) and everyone else. Over the last 12 trading days, shares of BBBY have either been the best or worst-performing stock in the S&P 1500 on nine different trading days. Not only that, but on one of the three trading days where it wasn’t the best or worst performing stock in the S&P 1500, it was the 2nd worst on one of those days and in the bottom ten on the other two. There are literally hundreds of stocks in the S&P 1500 that will go months or years without cracking the top ten best or worst daily performers list, but for some reason, BBBY has been making it an everyday occurrence lately. Maybe instead of the S&P 1500, we should call it the S&P Bed Bath & Beyond! It’s often tempting for investors to go where the ‘action’ is, but no one ever gets rich following the crowd. Use your imagination. It will take you places.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
Aug 29, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“The greatest education in the world is watching the masters at work.” – Michael Jackson
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
If you planned on a quiet week of trading ahead of the unofficial last week of summer, you might want to adjust your plans. After plunging Friday, the only ones seemingly on vacation this morning are the dip buyers. Equity futures are down nearly 1% while US Treasury yields are moving higher. The 10-year yield has moved back above 3.1% which is still below the highs from June, but the 2-year yield briefly took out those June highs, so the upward direction in rates has resumed following Powell’s hawkish speech on Friday. The economic calendar is quiet today with the Dallas Fed Manufacturing report coming out at 10:30 Eastern. Economists are expecting a negative print but an improvement from July’s level of 22.6.
In many ways, last week was a normal one for the stock market- at least in terms of 2022 performance. To put it succinctly, Energy was up and everything else stunk. As shown in the graphic below from our Trend Analyzer, Energy was up over 4% taking its YTD gain back above 50%, while every other sector fell at least 1% and, in most cases, much more than that. Leading the way to the downside, Technology, Consumer Discretionary, Communications Services, and Health Care all fell more than 4%.
Despite the sharp declines last week, most sectors remain above their 50-day moving averages (DMA) with the only two exceptions being Communications Services and Health Care. It remains to be seen whether last week was a pause in the sharp rally off the June lows or a resumption of the bear market, but if the majority of sectors can stay above their 50-DMAs, the bulls still have some hope to cling to.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
Aug 26, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“There is no risk-free path for monetary policy.” – Jerome Powell
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
Futures have been digging out of their hole all morning, but still remain in negative territory ahead of Powell’s speech in Jackson Hole at 10 AM. Crude oil is modestly higher this morning while US Treasury yields are modestly lower. Outside of the Fed, one big story crossing the wires right now is from Bloomberg which is reporting that the US and China have reached a preliminary deal regarding audits that could avoid delistings of Chinese companies from US exchanges.
It’s also a busy morning for economic data, and for the 8:30 batch, Personal Income and Spending were both weaker than expected, but PCE inflation data came in weaker than expected. At 10 AM, we’ll get the Michigan Confidence report which will be interesting to watch as it will come out just as Powell starts speaking.
Ahead of Powell’s widely anticipated speech today, the equity market is following the technical playbook to a tee. After stalling out just short of its 200-DMA last week, the pullback that followed found support right at the June highs and the brief period of consolidation that occurred right before the August rally run to the 200-DMA. While not necessarily a technical term, the saying, “if at first, you don’t succeed, try again”, seems applicable to where the market is today relative to its 200-DMA. Now, we just have to wait to see if Powell’s speech will provide some fuel for that attempt or put on the brakes. We’ll know within the next couple of hours.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
Aug 25, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“It’s hard to live your life in color, and tell the truth in black and white.” – Gregg Allman
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
We’re still a full day from Powell’s Jackson Hole speech, but futures have shown some resilience this morning indicating a positive start to the trading day. Interest rates are little changed but slightly biased to the upside. It’s a busy day for economic data for jobless claims, GDP, Personal Consumption, and Core PCE all at 8:30 with the KC Fed Manufacturing report coming out at 11 AM. The 8:30 data was just released and Jobless Claims came in lower than expected on both an initial and continuing basis. The revision to Q2 GDP came in at a decline of 0.6% which was slightly less worse than forecasts for a decline of 0.7%. Personal Consumption came in right in line with forecasts at 1.5% while Core PCE was 4.4% which was in line with consensus forecasts. All in all not much in the way of big surprises.
As investors gnaw on their fingernails in anticipation of Friday’s Powell speech in Jackson Hole, they remain anxious about the direction of interest rates. The yield on the 10-year US Treasury has gone from a multi-year high of just under 3.5% in late June down to 2.57% in early August. Since that low, yields have rocketed higher and closed yesterday at 3.10% which is right around the same levels they temporarily peaked at in the Spring. If yields continue higher in the coming days, a run to new highs will seem like a foregone conclusion which would act as a headwind for risk assets, but if yields start to stall out here, the chart of the 10-year yield will look more like a head and shoulders and provide a sigh of relief.
The two-year yield is another story. Just yesterday, the yield finished the day right at 3.39% which was just four basis points (bps) below its June 14th high. Like the 10-year, the direction of the 2-year yield in the coming days will likely play a big role in the stock market narrative for weeks to come.
Whichever way yields move, the 10-year/2-year Treasury yield curve remains firmly entrenched at inverted levels and is one of an increasingly growing number of indicators out there suggesting that the economy is either on the verge of or already in a recession.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
Aug 24, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“If you want to succeed you should strike out on new paths, rather than travel the worn paths of accepted success.” – John D. Rockefeller
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
Trading this morning has been directionless, but it’s better than the alternative of weakness which has been the prevailing tone. Fed Chair Powell’s Jackson Hole Speech on Friday continues to be the main focus of investors, and expectations for the tone of the speech are low. Have you spoken to anyone in the last seven days who thinks Powell’s message will be a positive for the market?
In economic news this morning, Durable Goods for July were unchanged, which was weaker than expected, but ex Transportation, the reading came in better than expected (+0.3% vs +0.1%). The only other report on the calendar is Pending Home Sales at 10 AM.
Treasury yields are mostly lower across the curve except for the two-year which is 2 bps higher and further flattening or inverting various portions of the yield curve. In commodities, crude oil continues to run higher following reports yesterday that OPEC would consider cutting production and that has pushed WTI up to just under $95 per barrel.
As oil prices have moved back into the mid-90s per barrel and natural gas surges to multi-year highs, the Energy sector has gotten a jump. Since its July 14th low, the Energy sector has rallied more than 20% taking it from extreme oversold to extreme overbought levels in the span of six weeks, and as of yesterday’s close, the sector is less than 11% from its 52-week high in June.
Perhaps even more impressive than the rebound in price has been the about-face in the percentage of stocks in the sector trading above their 50-day moving average (DMA). While not a single stock in the sector was above its 50-DMA less than three weeks ago, as of yesterday’s close all but one name was above that level (bottom chart). The lone hold-out has been Baker Hughes (BKR), but even it is now just barely 2% below its 50-DMA. Falling oil prices and the prospects of lower inflation have played an important role in the broader market’s summer rally, but the recent trends for oil and natural gas and stocks in the Energy sector may be starting to shift.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
Aug 23, 2022
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“Coaches have to watch for what they don’t want to see and listen to what they don’t want to hear.” – John Madden
Below is a snippet of content from today’s Morning Lineup for Bespoke Premium members. Start a two-week trial to Bespoke Premium now to access the full report.
Futures are marginally higher this morning as investors continue to apprehensively await Friday’s speech by Fed Chair Powell in Jackson Hole. After a quiet day for economic data to kick off the week, today we’ll get updates on manufacturing and services activity with preliminary PMI readings from S&P 15 minutes after the opening bell. Then, 15 minutes later, we’ll get the release of the August Manufacturing report from the Richmond Fed along with New Home Sales. Investors aren’t expecting much in the way of strength from these reports, so hopefully for bulls, they don’t put too much upward pressure on interest rates as the 10-year yield is once again comfortably above 3%.
It’s getting to the point where you can set your clock to it. When the yield on the 10-year US Treasury hits 3%, sell stocks. Back in early May, when we first topped 3%, the S&P 500 dropped 5% in a week and 1% over the next month. In early June, it happened again. The 10-year yield topped 3% for the first time in four weeks, and once again the S&P 500 dropped 9% in the next week and 7% over the next month. Yesterday, the 10-year yield once again moved above 3% for the first time in a month, and the S&P 500 fell 2%!
The chart below shows the S&P 500 over the last 12 months with red dots indicating every day that the 10-year yield finished north of 3%. Not a good thing for equity performance. Will this be the market’s third strike or will the third time be the charm?
You can’t fault equity investors for being uneasy given the moves we have seen in the US Treasury market lately. Back in mid-June, the year/year change in the 10-year yield was more than 200 basis points (bps), and it still stands at 177 bps. That magnitude of change in the span of a year is practically unheard of during the careers of most people currently on Wall Street. While there were similar spikes in yield coming out of the Financial Crisis and back in mid-2004, the only period where yields experienced an even greater increase was back in early 2000.
Our Morning Lineup keeps readers on top of earnings data, economic news, global headlines, and market internals. We’re biased (of course!), but we think it’s the best and most helpful pre-market report in existence!
Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.
