Jun 23, 2020
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Trying to read the tea-leaves in the ongoing saga between the US and China has become increasingly difficult these days with last night being a perfect example. Shortly before Asia opened for trading, US futures were moderately higher, but then Trump adviser Peter Navarro dropped a tape-bomb saying the US-China trade deal was ‘over’. That sent Dow futures from up over 200 to down over 400 in a matter of minutes. Navarro later walked back those remarks, and even the President took to Twitter to say the trade deal was ‘fully intact‘. (Twitter hasn’t put any warnings or labels on that tweet, so we’ll assume that it’s accurate info!)
After all the overnight ups and downs, futures are actually higher now than they were before Navarro made his comments, indicating a 1.25% gain at the open.
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, how Navarro’s comments have impacted the market in the past, the latest batch of June PMI data out of Europe, global and national trends related to the COVID-19 outbreak, and much more.
Crude oil prices are back above $41 per barrel for the first time since March 9th when Russia and Saudi Arabia started their price war. What a trip it’s been over the last three and a half months as prices have seen a round trip of around $80 lower and higher during that span.
While crude oil prices have recovered all of their losses since the gap down on March 9th, the S&P 500 Energy sector isn’t quite back to its levels from prior to March 9th and has some catching up to do. At yesterday’s close, the Energy sector was still down over 6.5% from where it closed on Friday, March 6th.
Jun 22, 2020
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Futures are only indicated slightly lower this morning after trading down significantly more shortly after they opened Sunday night. Investors have shaken off early concerns related to rising COVID case counts, but gold prices are near multi-year highs, and the 10-year yield remains below 0.70%.
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, moves in overseas markets, global and national trends related to the COVID-19 outbreak, and much more.
The S&P 500 is currently on pace for a gain of just under 2% in the month of June which is nothing to sneeze at. However, after a gain of over 12% in April and more than 4% in May, June performance seems relatively meager. That being said, the slowdown in the pace of the rally this month is helping to work off overbought conditions for most sectors. Through Friday’s close, just three sectors (Technology, Communication Services, and Consumer Discretionary) are overbought while the remaining eight sectors finished the week off in neutral territory. Of those eight sectors, the only one below its 50-day moving average is Utilities, which was also down more than any other sector last week (-2.01%). Technology continues to top the leaderboard as it’s up the most of any sector YTD, the most above its 50-DMA, and, behind the Health Care sector, was the second-best performing sector last week.
Jun 19, 2020
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 free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
With three positive days already, it has already been a positive week for US equities, and today is looking to be another good day with S&P 500 futures up over half of one percent. The catalyst for today’s move is a reported agreement from China to step up agricultural imports of US goods as part of this week’s talks in Hawaii.
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, a discussion of the US dollar’s swings over the last three months, global and national trends related to the COVID-19 outbreak, and much more.
Remember back in late March when it seemed as though every Friday in the equity market was a down one? At the time, no one in their right mind wanted to be buying stocks ahead of a weekend where the headlines surrounding the COVID outbreak were only getting worse. In early April, the Surgeon General warned Americans to prepare for “the hardest and the saddest week of most Americans’ lives.”
The old saying says to buy when there’s blood in the streets, and just as it seemed the news surrounding the COVID outbreak couldn’t get worse, the down Friday pattern completely reversed. After eleven down Fridays in the first fourteen weeks of the year, the last ten have seen a complete reversal where nine of them have been positive. Today looks to be a continuation of the trend as S&P 500 futures are currently indicating a gain of about 50 basis points at the open. The lesson of this pattern? Investing based on the headlines, especially when they’re at their most extreme (unless you’re doing the opposite) is one of the most sure-fire ways to underperform.
Jun 18, 2020
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It’s been a rather volatile overnight session in equity futures. Late last night, futures bottomed out with a decline of well over 1% but then recovered steadily in the early morning hours right up until 5 AM eastern time. Since then, much of the gains have been reversed, and the S&P 500 is poised to open firmly in negative territory.
The overnight volatility we have seen comes as rising COVID case counts around the world and around the country start to weigh on investor sentiment. After the sharp rally, investors are looking to reassess where things stand in terms of government stimulus, economic growth, earnings, and global health trends. Not an easy job by any means!
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, a look at infrastructure stocks, global and national trends related to the COVID-19 outbreak, and much more.
Anytime a streak reaches eleven, we always feel compelled to invoke the famous quote from the movie Spinal Tap. With this week’s drop, initial jobless claims have now dropped for a record 11 straight weeks. While the decline versus last week is encouraging, we also have to note that this week’s drop in claims was the smallest weekly decline in claims of the entire streak. Hopefully, this isn’t a sign of waning momentum in the job market.
Jun 17, 2020
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 free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
Markets are poised for another positive start to the day today, although not nearly to the degree of yesterday’s surge. On the economic calendar, today’s big reports are Housing Starts and Building Permits. While the continued surge in mortgage applications suggested a positive backdrop for housing, the actual numbers came in weaker than expected. Housing Starts were expected to come in at a level of 1.1 million but were well short at 974K. For Building Permits, the 1.220 million print was also weaker than the 1.245 million consensus estimate.
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, European auto sales, mortgage applications, global and national trends related to the COVID-19 outbreak, and much more.
In yesterday’s report, we discussed the rally in chips and how semiconductors trading at new highs relative to the S&P 500 was a positive trend for the broader market. From yesterday’s discussion of chips, today we wanted to highlight ‘dips’ and how investors have been buying them recently. In the last three trading days, the S&P 500 ETF (SPY) has finished the day more than 1.5% above its intraday low. That may not sound all that noteworthy, but before two occurrences in March, the last time we saw a similar pattern was back in 2011.
The idea of consistent buying on the dips sounds like a positive trend, but the reality is that it isn’t much of a consistent signal in either direction. The most recent occurrences in March, late 2011, and late 2008 all occurred in the later stages of market declines, but there was also an occurrence right near the 2007 peak as well as multiple occurrences from 2000 right through 2002. It sounds great in theory, but this is one trend we wouldn’t put much stock into.
Jun 16, 2020
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 free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
After yesterday’s rally stunning reversal, which was attributed (wrongly in our view) to the FOMC announcing that it would start buying corporate bonds, global equities are in rally mode again this morning on reports of a $1 trillion stimulus plan scheduled to be unveiled by the Trump Administration for roads, bridges, and technology projects. Futures are at their highs of the morning ahead of what will be a busy day of economic data.
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, the global rally in risk assets this morning, economic sentiment, global and national trends related to the COVID-19 outbreak, and much more.
The chart below from page two of our Morning Lineup report shows the daily overbought/oversold readings of the S&P 500 over the last year. The brief dip into neutral territory following Thursday’s rout didn’t last long as the S&P 500 closed back at overbought levels yesterday and with futures currently up over 3%, we’re only moving further back into overbought levels now.
