Morning Minutes

New High For The FTSE; Oil Rallies as Inventories Decline




The positive response from investors to Fed Chair Powell’s speech where he recognized inflation pressures are easing but indicated the Fed is continuing its fight to get inflation under control, which sparked a rally in North American markets yesterday, has continued overseas.

Continuing the momentum from Tuesday’s gains of 0.8% to 1.9% for US Indices, major European indices are up across the board led by a 0.7% gain for the Dax. Perhaps most significantly, the FTSE, which recently cleared the hurdle of its 2018 peak, continues to rally to new all-time highs with a 0.7% gain today. This breakout adds to a series of bullish signs across world markets recently including the completion of a Head and Shoulders bottom and a Golden Cross by the S&P 500 and other senior indices.

US index futures are down 0.3%-0.4% in what looks like common backing and filling following a rally, but a mixed series of earnings announcements out of the US doesn’t seem to be helping. On the positive side, Uber ($0.29 vs street -$0.15), Under Armor ($0.16 vs street $0.09) and CVS Health ($1.99 vs street $1.92) have beaten expectations while on the negative side, Chipotle Mexican Grill ($8.29 vs street $8.91) and Constellation Software ($16.15 vs street $18.03) had disappointing numbers. After the close today, Walt Disney, Sun Life and Great West Lifeco are expected to report results.   

WTI Crude Oil is up 0.8% this morning and has regained $77.50/bbl after getting a boost from a drawdown in last night’s US API weekly oil storage report (-2.1 mmbbls vs previous 6.3 mmbbls). Weekly DOE oil inventories are due at 10:30 am EDT (street 2.4 mmbbls vs previous 4.1 mmbbls).  

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Colin Cieszynski, Chief Market Strategist

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

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