Aug 16, 2024
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.
“Don’t think about the start of the race, think about the ending.” – Usain Bolt
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Markets are priced to close out a strong week quietly as equity futures are indicated modestly lower, and they took another modest downturn following the release of Housing Starts and Building Permits which both missed forecasts and dropped to the lowest levels since mid-2020. The only other release on the calendar for today is Michigan Sentiment at 10 AM. Outside of equities, we’ve seen larger moves in the Treasury market where the 10-year yield is down over 6 bps and crude oil is down over 2.5%.
It’s been a very impressive rally around the world since last Monday’s sharp sell-off, but one familiar aspect of the bounce has been that the US is once again leading the way. While the S&P 500 closed marginally above its 50-day moving average (DMA) on Wednesday, it convincingly broke through that level on Thursday, breaking through its short-term downtrend from the July highs and erasing all its August losses.
Over in Europe, the STOXX 600 has also rebounded, but it has yet to convincingly break back above its 50-DMA or its short-term downtrend of lower highs.
Japan was ground zero for last week’s decline and saw larger losses than any other global index. While it has also staged an impressive rebound, the TOPIX finds itself deeper in the hole as the 50-DMA has yet to come into play.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
Aug 15, 2024
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.
“History is a set of lies agreed upon.” – Napoleon Bonaparte
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Investors came into the day in a positive mood as gains overnight in Asia and a positive morning in Europe flowed through to the pre-market in the US. Crude oil and gold were also up about 1% with WTI trading at a lucky $77.77 per barrel.
One of the biggest catalysts for this morning’s positive tone has been in shares of Wal-Mart (WMT) which is poised to gap up over 7% in reaction to earnings. For perspective, if the gains hold through to the closing bell, it would be the first time since at least 2001 that the stock rallied more than 5% in reaction to back-to-back earnings reports.
A slug of economic data just hit the tape, and nearly all the reports came in better than expected, including Retail Sales which doubled expectations (1.0% vs 0.4%), while initial and continuing claims were better than expected. In response, futures have taken another leg higher as fears of economic weakness have been eased even as a September rate cut remains likely.
Between the monthly Retail Sales report, earnings from Wal-Mart (WMT), and other companies from the sector, it’s been a busy morning for the retail sector. On a non-earnings-related move, shares of Ulta Beauty (ULTA) are surging more than 12% following news after the bell yesterday that Berkshire Hathaway had taken a position of 690K shares worth $266 million in the company as of the end of Q2. To put that in perspective, even after Berkshire cut its stake in Apple (AAPL) by more than half this year, that position is still more than 300 times larger than its current stake in ULTA. Nevertheless, the Buffett seal of approval alone is enough for investors to flock to the stock.
Looking at the performance of ULTA over the last year, Berkshire’s purchase wasn’t the timeliest in the short term. While we have no way of knowing at what point in the quarter the stock was purchased, even after accounting for its pre-market surge, it is trading below where it traded at any point in Q2. From April 1st through June 30th, shares of ULTA traded in a range of $375.31 to $529.67. While it’s unlikely that Berkshire entered the position anywhere near the high end of that range as it only traded there for a couple of days early in the quarter, it’s just as unlikely that Berkshire bottom-ticked it. That’s because the stock doesn’t often trade more than a million shares a day, so a 690K trade would have greatly impacted the stock. The fact that Berkshire remains underwater on the stock doesn’t mean that ULTA won’t end up as a winning stock, but even when it comes to the best investors in the world, timing isn’t always perfect.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
Aug 14, 2024
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.
“Talent is never enough. With few exceptions the best players are the hardest workers.” – Magic Johnson
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
There wasn’t much going on in equity futures this morning as the market awaited the release of the July CPI which came in right on target relative to expectations. Stocks in Asia were mixed with Japan up 0.6% while China was down 0.6%. Yields in China were also lower as the government auctioned off a 20-year bond at a record-low yield. European stocks look more positive with slight gains across the board as GDP came in right in line with forecasts (0.3%) and UK inflation unexpectedly declined.
In financial markets, we almost always emphasize upcoming economic reports and/or Federal Reserve meetings too much. Invariably, the reality of the report rarely lives up to the energy of the anticipation that precedes it. Last month’s CPI report was one of those rare exceptions as market performance practically turned on a dime.
The chart below compares S&P 500 industry group performance on a YTD basis through 7/10 (the close before the June CPI report was released) versus how each group performed since then. Leading up to the report, the S&P 500 had rallied more than 18% on a YTD basis, and since then, it has declined over 3.5%. There has been a clear trend among industry groups where the best performers leading up to the report have been among the worst performers since then while the weakest groups on a YTD report have held up the best since the release.
As an example, the top five performing industry groups on a YTD basis through 7/10 all rank in the bottom ten in terms of performance since then, while three of the five worst performing groups YTD before the June PPI (Consumer Durables, REITS, and Real Estate Mgmt) rank as the top three performing groups since then.
On the upside, only two industry groups rank in the top ten in terms of performance for both periods – Insurance and Telecom Services.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
Aug 13, 2024
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.
“What frightens us today is exactly the same sort of thing that frightened us yesterday. It’s just a different wolf.” – Alfred Hitchcock
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Futures were higher coming into the July PPI report and got a further boost after a lower-than-expected PPI report. S&P 500 futures are up over half a percent, and the Nasdaq is indicated to open up over 1%.
The rally in US stocks followed what was a very positive night in Asia and specifically Japan. After Japanese stocks experienced one of the worst single-day declines in history last Monday, the TOPIX has come roaring back over the last week with a gain of 14.7% for its best five-day gain since November 2008 and the fourth best on record (it was closed on Monday). Despite that monster gain, the TOPIX is barely up over the last five trading days (red dot in the chart below).
Zooming in just on periods when the TOPIX rallied more than 10% in a five trading day period, its performance over the last six trading days ranks as the worst on record.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
Aug 12, 2024
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 distance between insanity and genius is measured only by success” – Ian Fleming
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
It’s a quiet morning in the markets which is a complete 180-degree turn from last week at this time. Futures are modestly higher, but we have a busy week of economic data ahead and the unofficial end to earnings season when Wal-Mart (WMT) reports on Thursday morning.
It was a whipsaw week for US equities, but you wouldn’t have known if from the snapshot in our Trend Analyzer as no sector was up or down more than 1.7%. There’s a good degree of disparity at the sector level though. While mostly defensive sectors like Health Care, Utilities, Real Estate, and Consumer Staples all finished the week at overbought levels, Consumer Discretionary, Technology, Energy, and Materials all finished the week below their 50-day moving averages.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
Aug 9, 2024
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 are three things in the world that deserve no mercy; hypocrisy, fraud, and tyranny.” – Frederick William Robertson
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Since the start of 2022 (when the last bear market began), there have been 26 one-day gains of 2%+, and 23 of those came in 2022 when markets were struggling. Yesterday was just the 2nd 2%+ gain of 2024 and there was only one 2%+ gain in all of 2023. As shown below, the S&P has averaged a small decline of 0.14% on the day after 2%+ up days since 2022 and a bigger drop of -0.39% in the week after 2%+ gains. Over the next month, though, the S&P has averaged a gain of 1.10%.
Continue reading today’s full Morning Lineup by starting a two-week trial to Bespoke Premium.
