Morning Minutes

Earnings Season Resumes; China Retreat Continues



Chinese markets sold off for a second straight day on concerns about increased government intervention in certain sectors. The Hang Seng plunged another 4.2% overnight, which Shanghai slid 2.5%. The Nikkei climbed 0.5% in a flight to relative safety, while European markets fell again with the Dax and FTSE both losing about 0.4%. Cryptocurrencies have turned back downward with Bitcoin and Ethereum both falling about 5.2%. That being said, gold is flat and sitting right on $1,800/oz while the US 10-year treasury note yield is steady at 1.25%, suggesting that fear remains contained for the moment with no big rush into defensive havens.

US indices are flat (Nasdaq futures) to down 0.25% (Dow futures), essentially reversing yesterday’s US index action to leave markets flat on the week so far. US durable goods orders fell off faster in June than expected (0.8% vs street 2.1% and previous 3.2%)

US earnings season has kicked into high gear with a number of significant results out overnight and this morning including 3M ($2.59 vs street $2.28), General Electric ($0.05 vs street $0.03, raised 2021 free cash flow guidance), UPS ($3.06 vs street $2.82), and Tesla (EPS $1.45 vs street $0.98 sales $12.0B vs street $11.3B). In Canada today, miner Teck Resources’ results were mixed with earnings up over a year ago but not quite as much as investors had hoped ($0.63 vs street $0.65 and year-ago $0.17).

It’s a big day for Big Tech earnings with Apple, Microsoft and Alphabet (Google) all scheduled to report earnings after the close this afternoon along with Starbucks, Visa and AMD. Tomorrow’s headliners include McDonalds, Facebook, Shopify*, Canadian Pacific, and several senior gold miners.  

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

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Colin Cieszynski, Chief Market Strategist

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

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