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 think your boss is stupid, remember: you wouldn’t have a job if he was any smarter.” – John Gotti

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.

A negative week for equities looks like it’s set to continue this morning as both the S&P 500 and Nasdaq are on pace to break winning streaks of five and eight weeks, respectively.  While losses have been accelerating as we approach the opening bell, we would note that heading into today, each index is down less than 1%, and given this year’s pattern for strength on Fridays, don’t write off the streaks just yet.

It’s a quiet day on the economic calendar this morning as the only reports will be S&P Global Manufacturing and Services sector PMIs, but similar reports were reported this morning for the Eurozone, and both the Manufacturing and Services sector PMIs came in weaker than expected and down from last month’s readings.  For individual countries like Germany, UK, and France, PMIs were also mostly lower across the board and weaker than expected.  The only exception was France where the Manufacturing PMI came in slightly ahead of expectations but still well below 50.

Given the weak tone of the data coupled with the fact that major central banks like the ECB, BoE, and even the Fed (based on Powell’s testimony) have taken a more hawkish stance, it shouldn’t come as a surprise that equities in the region are lower this morning and down at least 2% on the week. Thankfully, on this side of the Atlantic, the market saved the weakness for a short week.

In a year where there has been much divergence between different areas of the equity market, one trend over the last few days has been consistent across all of the major indices.  As shown in the charts below, whether we’re talking about micro-caps, mid-caps, or mega-caps, they all took a breather this week after recent sharp rallies.  Some of these rests are well deserved as indices like the S&P 500, Nasdaq 100, and S&P 100 all managed to rally to 52-week highs, but for smaller cap indices, the breaks may not have been as well deserved.

Looking at where all six of these indices are trading relative to their trading ranges, all six have pulled back from ‘extreme’ short-term overbought levels and now remain merely at overbought levels.  One trend that hasn’t changed even in the last week, though, is the outperformance of mega-caps relative to smaller caps.  While it may look like it at first glance, the table is not sorted by the market cap that each index tracks, but instead by performance over the last five trading days. The more thing change…

Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.

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 militarists in Berlin, and Rome and Tokyo started this war, but the massed angered forces of common humanity will finish it.” – Franklin D Roosevelt

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.

It’s feeling a little big Goundhog Day-ish this week as equity futures are down setting the stage for a fourth straight day of declines and treasury yields are higher. The main culprit again this morning (besides profit-taking) is higher rates.  As expected this morning, the Bank of England raised interest rates, but what wasn’t expected was the size of the hike which was 50 bps versus expectations for an increase of 25 bps.  Elsewhere in Europe, Switzerland hiked rates by 25 bps and Norway hiked rates by 50 bps.  The title for the biggest hike, however, goes to Turkey which boosted rates by 650 bps to 15.0%, and believe it or not, the size of that hike was actually much less than expected. And you thought another 25-bps hike from the Fed was a big deal!

There’s a lot of economic data on the calendar this morning with the Chicago Fed National Activity Index (weaker than expected) and Jobless Claims (initial weaker, continuing better than expected) at 8:30, Existing Home Sales and Leading Indicators at 10 AM, and the KC Fed Manufacturing report at 11.  Besides those reports, buckle up for a ton of Fed speak with Powell, Waller, Bowman, Mester, and Barkin all scheduled to speak throughout the trading day.

On the earnings front, five companies have reported earnings this morning and all five reported better-than-expected earnings and four managed to top revenue forecasts as well.

79 years ago today, FDR signed the last of the New Deal reforms into law creating what has become known as the G.I. Bill which provided support for returning servicemen in the form of living assistance, low-interest loans for homes or small businesses as well as funds for education.  With that piece of legislation, the G.I. Bill unleashed a massive expansion in the college education industrial complex where the percentage of Americans with four or more years of college education quickly expanded from under 5% in 1940 to 17% by 1980.  In three of the four decades after FDR signed the legislation into law, the percentage of Americans with at least four years of college grew by over 34%.  If it was a stock, imagine what kind of multiple it would have traded at.

Start a two-week trial to Bespoke Premium to read today’s full Morning Lineup.