Markets Digest Conflicting Earnings And Economic Numbers

What has been a positive week for stocks and some commodities appears to be heading for a soft finish. Overnight in Asia Pacific Trading, the Nikkei fell 1.3% and the Hang Seng lost 1.6%. Trading has been more positive in Europe this morning where the FTSE is up 1.5%, the CAC is up 2.3% and the Dax is up 0.3%.

US index futures are trading down 0.2% to 0.5% so far today with NASDAQ futures the weakest, consolidating or giving back most of yesterday’s US index gains of 0.2% to 0.6%. Once again, investors reaction to overnight earnings reports has been wildly different. Despite beating the street on earnings ($0.54 vs street $0.45) Intel* is down 9.6% in premarket trading after management issued soft guidance for the winter quarter. Action in credit card companies has been odd. Visa who beat the street is down 2.9% in premarket trading, while American Express, who missed expectations slightly, is up 1.9% premarket.

Although big US inventory drawdowns have helped Crude Oil throughout this week, day to day swings have reflected changing sentiment toward China and energy demand forecasts. Crude Oil surged along with Chinese stocks mid week as China rolled out stimulus and market support measures, but with Hong Kong correcting overnight, US Crude Oil has been backsliding as well, currently down 1.1% on the day but still up on the week. Natural gas is down 0.75%. In metals action, Copper is flat, Gold is up 0.25% and Platinum has bounced 1.5%. Cryptocurrencies are in rally mode with Bitcoin up 3.5% and Ethereum up 1.4%.

US Core PCE inflation was slightly better than expected (2.9% vs street 3.0% and previous 3.2%), and personal spending exceeded expectations as well (0.7% vs street 0.4%). Stocks have come down and treasury yields are holding steady on this news. US pending home sales are due at 10:00 am EST.

*Shares of Intel are held in portfolios managed by SIA Wealth Management.

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