Morning Minutes 11/30/2020

Morning Minutes

Retail Sales and OPEC Meetings In Focus

November 30, 2020

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Market Commentary By:
Colin Cieszynski, CFA, CMT
Chief Market Strategist
ccieszynski@siawm.com
+1 (647) 282-4428

US investors are back from the Thanksgiving holiday weekend, but with it being the last day of the month, appear more focused on locking in profits to start the week. Dow futures continue to fall away from the 30,000 level, down 150 points this morning, or about 0.5%, while S&P futures are down 0.2% and NASDAQ futures are flat. Overseas trading has been mixed with the Dax climbing 0.5%, the FTSE flat, the Nikkei dropping 0.8% and the Hang Seng diving 2.0%.

Moderna is up 12.0% in premarket action today after announcing test results that showed 94% effectiveness for its COVID-19 vaccine. The company also announced plans to file for emergency approval today. Although the news has boosted its stock, action in index futures today compared with the last three Monday’s which also had positive vaccine news suggests that the broader market impact of vaccine progress continues to fade.

US Black Friday sales results announced over the weekend confirmed a decisive shift from in person sales, which plunged 52% from last year, to online sales, which jumped 22% from a year ago as reported by Adobe Analytics. Today the retail blitz continues with Cyber Monday, but its also possible that it may take the monthly retail sales reports to shed light on spending as many sales promotions have been extended over several days this year.

Crude oil is down this morning with WTI sliding 0.7% and Brent falling 1.0% as investors await the results of this week’s OPEC and OPEC+ meetings which are expected to set production levels for the first part of 2021. A production increase of 2.0 mmbbl/d had been planned for January. Speculation among journalists, analysts, and investors that the production increase could be delayed or slowed, has apparently been one of the forces propelling energy prices upward recently, but weekend reports suggest that some member countries are opposed to further restart delays so oil could potentially be volatile this week depending on the decision.

In addition to energy and retail news, it’s a busy week for economic reports. Over the weekend, China kicked things off announcing better than expected Manufacturing PMI (52.1 vs street 51.5) and Non-Manufacturing PMI (56.4 vs street 52.1) numbers. US Chicago PMI is due at 9:45 am EDT with the street expecting a slight decline to 59.0 from 61.1 last month.

Tomorrow December kicks off with Manufacturing PMI reports from around the world plus US construction spending. Wednesday is headlined by US ADP private sector payrolls, followed by Service PMI reports on Thursday and US nonfarm payrolls plus Canada employment on Friday.

It’s also earnings week for the big Canadian Banks, headlined by Bank of Montreal plus Bank of Nova Scotia on Tuesday, Royal Bank and National Bank Wednesday, TD Bank and CIBC on Thursday, and finishing with Laurentian Bank on Friday. In addition to earnings results, investors may look for comments on the health of different sectors/regions in the Canadian economy and also at loan loss provisions which their US counterparts cut back when they reported their results back in October.

 

Last Day to Support Team SIA Motacular Moustaches This Movember

 

This month, in support of men’s health, SIA team members are participating in the Movember charity fund-raising campaign. Many of us know someone who has fallen ill to prostate or testicular cancer, mental illness or have passed away in recent years and are looking for a way to give back. The funds we help Movember raise will support life-changing services for mental health, innovative research, and scientific breakthroughs for cancer care. We know it has been a difficult year for everyone; if you are interested and able to support the cause this year, please click on the link below to access our team’s site. https://ca.movember.com/team/2383675

 

Best Regards, Jeremy Fehr and the Motacular Moustaches team.

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