Earnings And Powell In Focus To Start The Trading Week

World markets are sloppy to start the week. US index futures are down 0.1% to 0.3%, consolidating Friday’s gains of 0.35% to 1.75%. European markets are mixed with the Dax down 0.1% and the FTSE up 0.3%. Asia Pacific trading was mostly soft with Tokyo up 0.5%, but Sydney, Seoul and Shanghai all falling 1.0% and Hong Kong slipping 0.2%.

Treasury yields are on the rise again this morning after Fed Chair Powell reiterated in a 60 Minutes interview over the weekend that the Fed is not in a hurry to cut interest rates and that the number of cuts this year is likely less than what markets have been pricing in. Central banks remain front and center this week with a steady stream of Fed speakers out on the circuit. Also the Reserve Bank of Australia is meeting on Tuesday and Bank of Canada Governor Macklem is speaking tomorrow.

The US 10-year treasury note yield has climbed back up to 4.10%, while the Germany 10-year Bund yield has crept up to 2.30% igniting another rally in the US Dollar. Gold is down 0.7% this morning, while Silver is down 1.2%.The Euro, Aussie and Canadian Dollars are all down about 0.3%. Commodities also in retreat again today alongside Chinese markets with Copper down 0.4% and US Crude Oil down 0.5%.

Earnings season continues this morning headlined by results from McDonalds which beat the street on earnings but fell short on sales ($2.95 vs street $2.82, same store sales 3.4% vs street 4.7%) due to the impact of war on Middle East locations and has dipped 1.0% in premarket trading. Caterpillar* is up 4.7% in premarket action after posting significantly stronger than expected earnings ($5.23 vs street $4.76).

This week features fewer reports from US mega cap stocks but a lot of results from US mid and small cap stocks plus Canadian companies. Results are due across a wide spectrum of sectors including Insurance, Restaurants, Energy, Communications and Materials. Headliners include Simon Property after the close this afternoon, Ford and Dupont tomorrow, Disney and Sun Life on Wednesday, ConocoPhillips, Cameco and BCE on Thursday, finishing with Pepsico, Enbridge and Telus on Friday.  

Service PMI reports have been rolling out this morning and generally have been better than expected and improved from last month with several countries including the UK, Japan and Italy above 50 in expansion territory. US ISM Service PMI is due at 10:00 am EST (street 52.0 vs previous 50.6). The Prices Paid inflation component (previous 57.4) may also attract attention. The rest of this week is relatively quieter for data headlined by Canadian PMI Tuesday, trade data and Bank of Canada minutes on Wednesday, China inflation on Thursday and Canadian employment/wage inflation on Friday. Friday is also Lunar New Year.

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

Terms and Conditions:

This information is for Investment Advisors only. The website is for informational purposes only and is not intended to provide a complete description of SIA Wealth Management’s products or services. Past performance is not indicative of future results. It should not be construed as investment advice or relied upon in making an investment decision. Products and services of SIA Wealth Management are only offered in jurisdictions where they may be lawfully offered for sale. The information contained in this Website does not constitute an offer or solicitation by anyone to buy or sell any investment fund or other product, service or information to anyone in any jurisdiction in which an offer or solicitation is not authorized or cannot be legally made or to any person to whom it is unlawful to make an offer of solicitation. All products and services are subject to the terms of each and every applicable agreement. It is important to note that not all products, services and information are available in all jurisdictions outside Canada.

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. SIA Wealth Management Inc. 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.