Central Bank Speculation, Trade Numbers and Retailer Earnings Move Markets

Building on yesterday’s bounces of 0.2%-0.6% for US indices, US index futures are up another 0.2% to 0.6% this morning. The US 10-year treasury note yield has stabilized near 4.09% heading into Day Two of Fed Chair Powell’s testimony to Congress.

Overseas market action has been more mixed. Asia Pacific trading saw the Nikkei lose 1.25% and fall back under 40,000 as speculation the Bank of Japan may be getting ready to finally start raising interest rates pushed the Yen up 1.0%. The Euro is down slightly today after the European Central Bank maintained its benchmark interest rate as expected. The ECB lowered its GDP and inflation forecasts for this year but indicated it wants to look more at wage inflation data in the coming months before deciding on when to start cutting interest rates.

Copper has jumped 1.3% after China released better than expected export and import numbers, suggestive of a reviving economy, but that did not carry through to US Crude Oil, which is down 0.4%, or Chinese equities as Hong Kong dropped 1.25% and Shanghai fell 0.4%. Alternative currency action is mixed with Gold up 0.3% and Bitcoin down 0.6%.

Earnings from retailers around the world continue to generate strong, decisive responses in both directions from traders. Yesterday Foot Locker plunged 29.3% and Nordstrom lost 16.1% following earnings reports. In Europe the morning, Hugo Boss is down 11.8% due to weak guidance, while in the US, American Eagle outfitters is up 11.6% premarket after announcing a new growth plan and restructuring. After the close today, results are due from Broadcom*, Costco and Gap Stores.

Canada posted a stronger than expected trade surplus ($0.5B vs street $0.1B). US weekly initial jobless claims were slightly worse than expected (217K vs street 215K). A big week for economic news wraps up tomorrow with US Nonfarm Payrolls (street 200K), Canada jobs (street 20K), plus wage inflation numbers for the US and Canada.  

*Shares of Broadcom 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.