Daily Morning Report

Thursday, July 18–Jim Wyckoff’s Morning Markets Report

Asian and European stocks were mostly weaker overnight, on some disappointing earnings reports. U.S. stock indexes are pointed toward weaker openings when the New York day session beings, on some mild profit taking after hitting record and contract highs earlier this week.

There are also declining expectations the U.S. and China can come to a trade agreement anytime soon, following recent downbeat rhetoric coming from both sides. Reports just out say China is demanding that the U.S. ease restrictions on its technology giant, Huawei. This situation has put a bit of a damper on global stock market bulls.

The key “outside markets” today see Nymex crude oil prices firmer and trading just below $57.00 a barrel. Meantime, the U.S. dollar index is slightly down.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Philadelphia Fed business survey, and leading economic indicators.

–Jim

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Wednesday, July 17–Jim Wyckoff’s Morning Markets Report

Asian and European stocks were mixed overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session beings, and are at or near their record and contract highs scored this week.

The important U.S. economic data point at mid-week is the afternoon beige book report from the Federal Reserve. It’s expected the report will lean dovish on U.S. monetary policy, given recent comments from Fed officials, including Chairman Jerome Powell. The Federal Open Market Committee (FOMC) meets on July 30-31.

In overnight news, the Euro zone consumer price index for June came in at up 0.2% from May and up 1.3%, year-on-year. Those numbers were just a bit above market expectations but still underscore the very low inflation in the major world economies. In fact, the German government auctioned a 30-year bond today, which fetched a yield of only 0.3%.

The key “outside markets” today see Nymex crude oil prices firmer and trading just below $58.00 a barrel. The oil market took a hit late Tuesday on reports that Iran may want to negotiate with the U.S. regarding U.S. sanctions on Iran. Meantime, the U.S. dollar index is slightly down after good gains posted Tuesday.

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the beige book, new residential construction, and the weekly DOE liquid energy stocks report.

–Jim

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The U.S. stock indexes this week have pushed to new contract and record highs amid a bullish cocktail of good U.S. economic growth and the prospects for an easier monetary policy coming from the Federal Reserve. In fact, one major brokerage said the stock market is set to provide returns that are five-times greater than returns on government bonds. Sounds like a no-brainer to be in the stock market, right? Veteran traders know that any trade that seems like a “lay-up” is one that should be very carefully scrutinized. Remember the old trading adage: “Markets can and will do anything and everything to frustrate the largest amount of traders.” Stay tuned!–Jim

Tuesday, July 16–Jim Wyckoff’s Morning Markets Report

Asian and European stocks were mixed overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session beings, and are at or near their record and contract highs. So far this week there have been no major news developments in the world to significantly move markets. Thus, typical lackluster mid-summertime trading has set in. However, a very busy day of U.S. economic data may shake loose the present summertime doldrums.

In overnight news, there was a downbeat economic report coming out of Germany, as the ZEW economic expectations index and current conditions index worsened in July. Germany is the economic workhorse for the European Union.

The key “outside markets” today see Nymex crude oil prices slightly higher and trading around $59.75 a barrel. The U.S. dollar index is higher early today.

U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and Goldman Sachs retail sales reports, retail sales, import and export prices, industrial production and capacity utilization, the NAHB housing market index, manufacturing and trade inventories, and Treasury international capital data. Several Federal Reserve officials are also slated for speeches today.

–Jim

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Monday, July 15–Jim Wyckoff’s Morning Markets Report

Asian and European stocks were mixed overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session beings, and at record and contract highs.

In overnight news, there was some downbeat economic news coming out of China, as its second-quarter gross domestic product rose by 6.3%, year-on-year, for the slowest growth pace in 27 years. This is leading to ideas China’s central bank will act to further stimulate the world’s second-largest economy. However, the weaker GDP report was somewhat offset by industrial production data for June that came out better than expected, at up 6.3%, year-on-year.

There were no significant developments over the weekend on the geopolitical fronts.

The key “outside markets” today see Nymex crude oil prices higher and trading just around $60.50 a barrel. The U.S. dollar index is slightly lower early today.

U.S. economic data due for release Monday is light and includes the Empire State manufacturing survey. The economic data pace really picks up the pace starting Tuesday.

–Jim

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The corn futures market bulls on Thursday made a strong showing in the face of some bearish monthly USDA supply and demand data released. Friday, grain traders are focusing on weather in the U.S. midsection. A powerful tropical storm in the Gulf of Mexico could wind up dumping some needed rainfall in the eastern Corn Belt early next week, or not. Weather forecasters are not in agreement on the storm’s path once it reaches landfall. With much of the Corn Belt now in need of a good drink of water, weather forecasts are driving the grain markets. Next Monday looks to be one of the more important grain-trading days of the summer, as updated weather forecasts coming out of the weekend will drive prices and likely make for higher volatility on Monday. Stay tuned!–Jim