Morning Minutes

Stocks Rally, Yields Drop as US Inflation Pressures Ease Slightly




After trading flat for much of the morning, US index futures have jumped following the release of today’s US inflation numbers. Currently, the three main index futures contracts are up 0.8% to 1.4% with NASDAQ futures leading the way upward. Meanwhile, the US 10-year Treasury Note Yield has dropped back toward 4.50%. Over in Europe, the FTSE is down 0.4% and the Dax is up 0.5%.

US Consumer Prices (3.2% vs street 3.3% and previous 3.7%) and Core CPI (excluding food and energy) were slightly better than expected (4.0% vs street and previous 4.1%)  and the reaction to these numbers suggests that traders are still looking more for reasons to buy than reasons to sell at the moment. Tomorrow brings US Retail Sales and Producer Prices.

Kicking off earnings week for US retailers, Home Depot (HD) shares are steady after the home improvement giant beat analyst expectations on earnings ($3.81 vs street $3.75). Tomorrow results are due from Canadian grocers Loblaws and Metro along with Target and TJX in the US. Thursday brings results from Walmart, Macys and Gap Stores.

Energy commodities are mixed today. WTI and Brent Crude Oil have both flipped from negative to positive literally while I have been writing this sentence. Natural Gas is down 1.5%. Metals like Gold and Copper are flat today.

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Colin Cieszynski, Chief Market Strategist

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

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