The Fuse
Equity futures are mixed today as it appears the debt ceiling agreement (in principle) might be a sell the news event. Markets are all over the place with the industrials down again but the Nasdaq leading the charge higher.
Interest Rates are lower today as worries of a slowdown in economic activity continue, as the long end of the curve is trying to force the hand of the Fed to cut rates sooner rather than later.
Great news of the weekend of a deal in Washington to increase the debt ceiling. Both sides did not get all they wanted and that means there was some compromise. Markets would cheer that news, but we are seeing some selling off on that news currently. End of the month tomorrow.
Tonight earnings from HPE, BOX and HPQ along with AMBA. Wednesday am brings us retailers CPRI and AAP.
Tomorrow is the end of the month and that may bring some buying pressure before the end of trading.
Pretty solid breadth but not as strong as one would think after such as solid up session. Stocks were pulled up again by technology names and that influence carried in a big way. We still have a neutral on the oscillators now but could see a higher level if markets close up today.
Volume remains solid and very strong over past few sessions, indicating strong participation from big institutional players.
Strong support on the SPX 500 at 4,100, which was tested last week. The Russell 2K has very strong support at 172.
The Internals
What’s it mean?
A strong day right out of the gate, stocks pushed higher after the release of some highly-inflationary economic data. That didn’t seem to matter as there was plenty of demand to buy stocks. The VOLD was straight up all session and led the other indicators higher. PUT/CALL came down again as call buyers were in a frenzy, the VIX fell hard and landed under 18%. We’ll see of there is some followthrough this week.
The Dynamite
Economic Data:
- Tuesday:
- Wednesday:
- Thursday:
- Friday:
Earnings this week:
- Tuesday:
- Wednesday:
- Thursday:
- Friday:
Fed Watch: The committee cannot be too pleased with the recent inflation data. We’ll have a few speakers out in this short week and update you later on the names and influencers who will deliver their speeches.
Issues/Stocks to Watch
Jobs Data – The recent gains in jobs data continue to confound everyone. Can we continue creating so many new jobs at this late stage of the cycle? We’ll find out more this week.
Washington DC – More drama with the debt ceiling issue, perhaps there is some progress this coming week, at least we hope so.
Volatility – The VIX fell hard last week and that often means ‘payback’ after a holiday. We’ll see if that happens and a sell the news event is the result.