Morning Minutes

Indices Rebound as Inflation Pressures Ease




Clawing back some of yesterday’s 0.5%-1.1% US index losses, US index futures are up 0.50%-0.75% this morning, with equities getting a boost from a retailer merger, positive earnings and no negative inflation surprises.

US Consumer Prices (3.2% vs street 3.3% and previous 3.0%), and US Core CPI (4.7% vs street 4.8%) came in slightly better than expected with prices excluding the more volatile food and energy components remaining stubbornly elevated. The US 10-year treasury note yield is holding steady at 4.00% indicating the numbers have not moved the needle on Fed expectations, although that could change later in the day with two regional Fed Presidents speaking this afternoon.  

Corporate news has been dominated by retailers overnight and this morning. Coach parent Tapestry announced that it has agreed to acquire Capri Holdings, owner of several luxury retailers including Versace for $8.5B. There also have been a few notable earnings reports including Canadian Tire ($3.08 vs street $3.05), Alibaba ($2.40 vs street $2.01, up 3.0% premarket), Wynn Resorts ($0.91 vs street $0.59, up 3.1% premarket), Manulife Financial ($0.83 vs street $0.78), and Disney ($1.03 vs street $0.96).

Currencies and metals are on the rise today with the US Dollar backing off. Gold is up 0.5%, Copper is up 1.0%. The Euro and Pound are both up about 0.4% while the Loonie is up 0.2%. Energy markets have cooled a bit today with Natural Gas down 1.1% and WTI Crude Oil down 0.25%.  

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Colin Cieszynski, Chief Market Strategist

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

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