Morning Minutes

Stocks Rebound Ahead of the Fed

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Please note that the Morning Minutes will not be issued for the rest of this week or next due to our summer break. They will return on Monday August 8.

Premarket action this morning finds US index futures clawing back most of yesterday’s losses with gains of 0.5% for Dow Futures and 1.4% for NASDAQ futures. Indexes are also higher in Europe this morning with the Dax up 0.5% and the FTSE up 0.6%. Energy markets are mixed and partly reversing yesterday’s moves with WTI crude oil up 1.0% and natural gas down 2.1%.

Ahead of today’s Fed decision and statement, which are due at 2:00 pm EDT, the US Dollar is down 0.2%-0.3% against the Euro, Canadian Dollar, and Gold. The US 10-year treasury note yield is holding steady near 2.8%. The US central bank is widely expected to announce a 0.75% interest rate increase today. Investors may also key in on the statement, looking for commentary on whether the US central bank sees rising inflation or a slowing economy as the bigger issue at the moment, and for hints on how much farther rates could climb this year.

US durable goods orders for June exceeded expectations (1.9% vs street -0.4%). US pending home sales are due at 9:00 am EDT (street -7.3%). Tomorrow the US Q2 GDP report is due which could confirm whether the country has fallen into a recession or not.

Canadian earnings season is off to a positive start with Loblaws and Canadian National Railway beating expectations. In the US, Microsoft and Alphabet/Google both missed on sales and earnings but are up in premarket trading. Visa beat the street while Boeing and T-Mobile US both disappointed.

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Colin Cieszynski, Chief Market Strategist

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

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