The Fuse
Equity futures are flat/mixed this morning after a couple of very sleep sessions. We might see the action pick up later in the week with a few big earnings reports, end of quarter window dressing and some big option expirations coming up next Monday.
Interest Rates are again pushing higher as the yield curve flattens out. 10 year yields have backed up towards 3,8% since the Fed meeting. Fed funds futures see a 58% chance of a double cut in November followed by one more in December.
Not much to cover overnight, the news was quiet. European stocks fell back about .3% on some profit taking, gold remains well bid near $2,700 per ounce, silver is pushing $30. Crude oil is off a bit as the $70 is straddled. German 10 yr bund yields held steady, Stocks in Asia were mixed, Japan down slightly while China and Hong Kong were up nicely following a new stimulus plan announced.
Earnings from Micron will be after the close today while tomorrow am we’ll hear from Accenture, Jabil and Carmax.
Meta Platforms has an a 2 day ‘Connect Event’ scheduled for this week, it might move the stock in either direction.
Breadth was okay on Tuesday as it appears the bulls are getting tired. Certainly understandable after some monster up days, but we are at the end of the month/quarter when some extra buying often occurs. Breadth still remains on a buy signal and if the small caps start to contribute more then that signal is going to continue on.
Volume trends have been lower this week following up on last week’s big move and expiration Friday. There is no doubt the turnover will pickup later in the week as we get closer to month end.
Support levels have been probed but mostly the dip buyers are active this week. Stochastics are embedded and as such permits the dip buyers to step in and add if the market starts to pull back (but not break). This happened both Monday and Tuesday. The SPX 500 has good support at 5,650 but watch out, that could be tested in a day and ruin everyone’s trading.
The Internals
What’s it mean?
Not much excitement about the internals this week. VOLD was up and the VIX was lower, but that’s about all we can say here. TICKS were mixed but leaning more bullish, ADSPD did not budge much while put/calls ran lower. A yawner so far, more fireworks later in the week.
The Dynamite
Economic Data:
- Wednesday:New Home Sales, Adrianna Kugler
- Thursday:jobless claims, durable goods, GDP revision, lots of Fed speakers including Powell
- Friday:August PCE, inventories, consumer sentiment, Miki Bowman
Earnings this week:
- Wednesday:MU, JEF
- Thursday:ACN, JBL, COST, BB
- Friday:N/A
Fed Watch:
Several Fed speakers this week including a speech from Chair Powell on Thursday. We don’t expect too much other than some clarity following last week’s big rate cut and forecast for more. Miki Bowman, a hawkish Fed Governor will be speaking on Friday.
