Daily Morning Report

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

OVERNIGHT DEVELOPMENTS

Asian and European stock indexes were mostly higher overnight. U.S. stock indexes are pointed toward modestly higher openings and near Tuesday’s six-month highs when the New York day session begins. The U.S. indexes are closing in on their record highs scored last fall.

Investors and traders continue to exhibit “risk-on” mentalities, as evidenced by the world stock markets trending higher and safe-haven gold and silver prices trending lower.

China’s gross domestic product report came out Wednesday and showed slightly better-than-expected growth of 6.4% in the first quarter, year-on-year. Stronger industrial production and retail sales were cited as boosting GDP. Most were expecting upbeat numbers just north of 6% annual GDP growth for the world’s second-largest economy.

In other overnight news, the Euro zone consumer price index for March showed a rise of 1.0% from February but was up only 1.4% year-on-year. Meantime, the U.K. CPI came in at up 0.2% in March and up 1.9% year-on-year. This continues a theme of very tame inflation in the world’s major economies.

An important change in market psychology has occurred just the past few weeks. Government bond yields in the world’s major economies are on the rise, after seeing their yields decline the first two months of the year. This is due in part to little risk aversion in the marketplace that is seeing monies flow into stock markets, which in turn prompts bond yields to rise in order to attract investor buying interest.

The key outside markets today find the U.S. dollar index weaker. Meantime, Nymex crude oil prices are higher and trading around $64.50 a barrel.

U.S. economic reports due for release Wednesday include the weekly MBA mortgage applications survey, the international trade report, monthly wholesale trade, the Federal Reserve’s beige book and the weekly DOE liquid energy stocks report.

–Jim

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The U.S. Treasury bond and Treasury note futures are in fledgling downtrends on their daily bar charts and the bears have some momentum on their side. Right now, it’s still my bias that these fledgling downtrends are just downside corrections from recent gains that pushed prices to contract highs in March. However, more strong selling pressure in the near term would suggest a market top is in place and that prices would continue to trend down in the coming weeks. This week’s price action in the U.S. bond markets will be extra important. Stay tuned!

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

OVERNIGHT DEVELOPMENTS

Asian and European stock indexes were mostly higher overnight. U.S. stock indexes are pointed toward higher openings and at six-month highs when the New York day session begins. The U.S. indexes are closing in on their record highs scored last fall.

There are presently no major geopolitical issues in the world marketplace to rattle the markets and trader and investor attitudes remains generally upbeat. In the U.S., the world’s largest economy is growing modestly to a bit better, but the Federal Reserve does not appear inclined to raise interest rates. Many reckon that’s a “Goldilocks” scenario for the stock market.

The key outside markets today find the U.S. dollar index slightly up. Meantime, Nymex crude oil prices are slightly higher and trading around $63.50 a barrel.

The marketplace is awaiting China’s gross domestic product report due out Wednesday morning. Most are expecting upbeat numbers north of 6% annual GDP growth for the world’s second-largest economy.

U.S. economic reports due for release Tuesday include the weekly Goldman Sachs and Johnson Redbook retail sales reports, the NAHB housing market index, and industrial production and capacity utilization.

–Jim

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

OVERNIGHT DEVELOPMENTS

Asian and European stock indexes were steady to mixed in quieter dealings overnight. U.S. stock indexes are pointed toward narrowly mixed openings when the New York day session begins. There are presently no major geopolitical issues in the world marketplace to rattle the markets and trader and investor attitudes remains generally upbeat, as evidenced by most world stock markets trending sideways to higher at present.

Focus of traders and investors this week will be on U.S. corporate earnings reports. Big bank reports issued last Friday were surprisingly upbeat.

U.S.-China trade talks will continue this week, with most market watchers thinking good progress has been made on the matter and both sides are close to a final agreement.

The key outside markets today find the U.S. dollar index weaker. Meantime, Nymex crude oil prices are lower and trading around $63.25 a barrel.

U.S. economic reports due for release Monday include the Empire State manufacturing survey, and Treasury international capital data.

–Jim

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The U.S. stock indexes hit six-month highs this week and continue to trend higher from last fall’s lows. Bulls have good technical power amid a gentle, low-volatility price uptrend in place on the daily bar charts. This low-volatility trading environment suggests more of the same in the coming weeks: sideways-to-higher price action. There are no early technical clues to suggest the stock indexes are close to topping out. Stay tuned!

Friday, April 12–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

Asian and European stock indexes were mixed to weaker overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins.

The U.S. corporate earnings season gets underway today, with big-bank results released, including JP Morgan and Wells Fargo. Several bank industry analysts are expecting somewhat downbeat earnings reports for the first quarter of this year.

In overnight news, China reported its import and export activity for March. Exports were up 14.2%, year-on-year, while imports were down 7.6% in the same period. These latest figures are deemed upbeat for China’s economy, given that in February its exports declined 20.7% from a year ago. Forecasters had expected a rise in China’s exports of around 9% in March.

The key outside markets today find the U.S. dollar index lower. Meantime, Nymex crude oil prices are higher and trading around $64.50 a barrel.

U.S. economic reports due for release include import and export prices, and the University of Michigan consumer sentiment survey. Also, the IMF and World Bank spring meetings get under way.

–Jim

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