morning review - 102710

8/8/2019 Morning Review - 102710

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Nicholas Colas (Chief Market Strategist): 212 448 6095 or [email protected] Clark: 212 448 6085 or [email protected]

Beth Reed: 212 448 6096 or [email protected]

I think it is impossible to say that the current rally has run its course, primarily because these two scenarios don’t feel especially probable. The Fed hastelegraphed its moves so a surprise there seems remote. And even if the Republicans come through on their expected wins next Tuesday, the fights over spending in D.C.will not be much easier in the next Congress. Will the Tea Partiers migrate to mocha frapps once they get used to life in DC? Hard to say at the moment.

But regardless of whether you think the “long risk/short dollar” trade is over, or just beginning, you will do well to track the dollar, tech and consumer stocks,and precious metals closely over the next week.



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U.S. EQUITIES

On the earnings front, F added 1.5% as it posted a 6th

consecutive quarterly profit (which was up 68% from a year ago), marking its best 3rd

quarter inroughly 2 decades. Despite topping estimates, raising its full-year outlook and posting revenue increases in all 6 business units, DD fell 1.0% on the day.Meanwhile, BMY (-1.1%) saw profits decline slightly on flat drug sales, UBS (-5.3%) announced an unexpected investment banking loss, and COH (+11.9%)and RCL (+14.5%) soared on better-than-expected earnings. In other news, many steelmakers faltered after MT (-5.3%) and X (-3.4%) cautioned that theywere experiencing a slowdown in demand, falling prices and rising costs. Also, AKS (-4.0%) posted soft quarterly results.

Important Conferences/Corporate Meetings Today:America’s Growth Capital East Coast Emerging Growth Conference – Boston, MA

Important Earnings Today (with Estimates) From…

Source: Thomson ONE

Three Day (High – 1193.00; Low – 1174.00): Prior Day SPX (High – 1187.11; Low – 1177.72; Close – 1185.64):

S&P Futures

One Day (High –1184.25; Low – 1174.00): ACE: $1.84 ACXM: $0.16 ADP: $0.53 AYE: $0.53 ARLP: $1.69 AB: $0.42 ALL: $0.95 AMP: $1.07 AIZ: $1.20 ATLS: $0.07 BYI: $0.46

EAT: $0.15 CDNS: $-0.02 CHH: $0.57 CMCSA: $0.30 CYH: $0.72 COP: $1.45 DPS: $0.60 EFX: $0.58 ESRX: $0.65 FMC: $1.11 GD: $1.64

MORN: $0.47 NYB: $0.31 NSC: $1.09 NOC: $1.76 ORLY: $0.74 ODP: $-0.02 ODFL: $0.41 OC: $0.37 OI: $0.87 PLXS: $0.60 PX: $1.20

HBI: $0.62 HMA: $0.12 HES: $1.05 IACI: $0.06 IP: $0.78 ICO: $0.08 ITC: $0.71 LAZ: $0.42 LM: $0.36 LSI: $0.08 MANT: $0.88

PG: $1.00

RRC: $0.04 RNR: $2.20 ROL: $0.26 SLAB: $0.33 SKX: $1.02 S: $-0.28 SRCL: $0.63 TER: $0.78 V: $0.94 VMED: $-0.08Source: Bloomber



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FIXED INCOME

Source: Bloomberg

Today’s Important Economic Indicators/Events (with Consensus): MBA Purchase Applications (7:00am EST) Durable Goods Orders (8:30am EST): 1.6% New Home Sales (10:00am EST): 300K EIA Petroleum Status Report (10:30am EST)

Source: Bloomberg

Demand was strong at the government’s monthly 2-year note auction, with coverage coming in at 3.43 times, the 3rd highest this year (trailing lastmonth’s 3.78 times and 3.45 times in June). The $35 billion offering drew a yield of 0.400%, which was ½ a basis point below the 1:00pm EST bid.Treasury prices declined on the day, boosting 10-year yields +8 bps to 2.64% and 30-year yields +8 bps to 3.99%. The yield on the 2-year added 3 bps,rising to 0.39%. Five-year and 7-year debt sales are expected on Wednesday and Thursday, respectively.

morning review - 102710

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