Morning Minutes 7/29/2020

Morning Minutes

Flat Markets Digest Earnings While Awaiting Tech Testimony and Fed Decision

July 29, 2020

At SIA Wealth Management everything we do is based on Relative Strength Analysis. We evaluate the Relative Strength between asset classes giving us insight into money flows on a large scale, and from this select top ranked investments.

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

Stock markets are steady this morning with US index futures up 0.3% to 0.6% while over in Europe, the Dax is up 0.1% and the FTSE is up 0.2%. Copper is up 0.1% but precious metals are stronger with gold rising 0.5% to trade near $1,950/oz. Crude oil is picking up today with WTI gaining 1.1% and Brent up 1.3% after API reported a 6.8 mmbbl drawdown in US weekly oil inventories.

It’s a busy day for earnings reports on both sides of the border. Shopify* is up 9.7% in premarket trading after reporting a 97% increase in sales over a year ago to $714M which was well above the $514M street estimate.

Other companies who beat expectations include: Visa ($1.07 vs street $1.03), General Motors (-$0.50 vs street -$1.77), Advanced Micro Devices ($0.18 vs street $0.16), eBay ($1.08 vs street $1.06), Amgen ($4.25 vs street $3.82) and Starbucks (-$0.46 vs street -$0.59).Enbridge with EPS of $0.41, met expectations. Several companies reported worse than expected results including Boeing (-$4.79 vs street -$2.54) and General Electric (-$0.15 vs street -$0.10). Meanwhile retailer L Brands announced plans to lay off 15% of its corporate staff.

A number of companies are expected to report results after the close today including Facebook, Sierra Wireless, Qulacomm, Fitbit, Agnico-Eagle, and Kinross Gold.

Developments in Washington could also potentially influence trading today. CEOs of several technology companies including Apple, Alphabet (Google), Facebook, and* are scheduled to testify to congressional anti-trust hearings today which could potentially impact NASDAQ sentiment. The Fed’s latest monetary policy decision is due at 2:00 pm EDT today. The street is not expecting any significant moves from the central bank but may look to comments in the statement or Chair Powell’s press conference for hints about the current state of the US economy and whether the Fed is considering taking additional action in future.

*Shares of Shopify and are held in some portfolios managed by SIA Wealth Management.

Disclaimer: SIA Wealth Management Inc. (SIAWM) specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIAWM nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.