Morning Minutes 5/21/2020

Morning Minutes

Stocks Backslide Amid Retailer Earnings, Jobless Claims and Flash PMI Reports

May 21, 2020

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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

US Markets have dropped back moderately this morning with Dow Futures down about 100 points or 0.4% after rallying 369 points or 1.5% yesterday. European indices have been in retreat with the Dax down 1.1% and the FTSE down 0.4%.

Investors continue to digest economic and earnings news. Crude oil is up again today with WTI up 1.9% near $34.00/bbl and Brent Crude climbing 2.25% as investors continue to respond favorably to the drawdowns announced in this week’s US DOE and API weekly oil inventories.

Today’s economic news is focused on flash PMI reports, the first indication of how economies around the world are doing in May. Results out of Europe were not as bad as feared, but not great either, still running well below 50 and deep in contraction territory. German results for example were as follows: Flash Manufacturing PMI (36.8 vs street 39.2 and previous 34.5), Flash Service PMI (31.4 vs street 26.6 and previous 16.2). UK results were Manufacturing (40.6 vs street 36.0 and previous 32.6), Service (27.8 vs street 25.0 and previous 13.4). US flash PMI reports are due at 10:00 am today with the street expecting readings of 38.0 for manufacturing and 30.0 for services.

The weekly US jobless claims report was a bit worse than expected. Initial claims were 2.438M, more than the 2.400 the street had expected but down from 2.687M last week. Continuing claims increase to 25.073M, which is more than the 24.765M the street had expected.

In retailer news, Macy’s put out a profit warning, suggesting management expects the company to lose $0.9B-$1.1B in the April quarter on a 45% plunge in sales. Some of its stores have started to reopen and the company expects to have most locations open again by the end of June. Best Buy’s results were not as bad as feared as the same store sales declineof 4.5% was less than the 10.0% drop the street was expecting, and EPS of $0.67 beat the $0.44 street estimate.


New Video: Market Commentary and Portfolio Update – May 20, 2020

With Paul Vendrinsky-Portfolio Manager, Ted Bader-President, and Colin Cieszynski – Chief Market Strategist, of SIA Wealth Management

A new webinar replay is available featuring Paul Vendrinsky and Ted Bader updating on the recent performance of SIA Wealth Managed portfolios, plus  Colin Cieszynski discussing current trends in world markets. A PDF version of this presentation is available.

GoToMeeting Version:

YouTube Version:


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