Morning Minutes

Stocks Slide Into Month-End Amid a Flurry of Economic and Earnings News




The last trading day for July finds stock markets around the world retreating once again. Overseas, the Hang Seng turned back downward, falling 1.3%, while the FTSE and the Dax are both down 0.8%. US index futures are all in the red as well today with NASDAQ futures down 1.2% and Dow Futures down 0.4%. Commodities are also backsliding, particularly Natural Gas which is down 2.2% as we head into the later stages of summer cooling season, while WTI crude oil and copper are both down about 0.2%.

Weakness in the NASDAQ today can be attributed to disappointing results overnight from, which missed street expectations on sales but beat on earnings (EPS $15.12 vs street $12.30, sales $113.0B vs street $115.2B, down 6.9% premarket). Pinterest is down 20.5% premarket after reporting that monthly active users fell by about 5% in Q2 to 454M from 478M in Q1 and was well short of the 482M street estimate.

It’s also a big day for results from the Energy, Consumer Staples and Industrials sectors. Highlights include ExxonMobil ($1.10 vs street $0.99), Chevron ($1.71 vs street $1.59), Caterpillar ($2.60 vs street $2.40), T-Mobile US ($0.78 vs street $0.53), and Procter & Gamble ($1.13 vs street $1.08).

Canada’s GDP declined by 0.3% in May as was expected by investors with most of the country in lockdown that month. Several senior Canadian companies are also reporting today including Restaurant Brands ($0.77 vs street $0.51), and Telus ($0.26 in line with expectations).

In US economic news today, personal spending increased more than expected in June (1.0% vs street 0.7%), outpacing personal income (+0.1% vs street -0.3%). The Fed’s favorite inflation measure Core PCE inflation, increased less than feared (3.5% vs street 3.7% and previous 3.4%. Chicago PMI, a potential leading indicator for Monday’s national manufacturing PMI report, is due at 9:45 am EDT today (previous 66.1).  

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Colin Cieszynski, Chief Market Strategist

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

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