Morning Minutes

Traders Try To Pick Up The Pieces as Earnings Reports Resume



World markets have started to stabilize from yesterday’s big selloff in equities and energy but so far, the bulls have only been able to stage a moderate comeback. For example, Dow Futures are up about 225 points or 0.6% compared with a loss of 725 points or 2.1% yesterday. Similarly, WTI Crude Oil has bounced 0.3% which seems small relative to yesterday’s 8.0% plunge. The strongest relative bounce of the day is in NASDAQ futures which are up 0.5% to claw back half of yesterday’s 1,0% loss as the technology and communications sectors continue to relatively outperform through this latest round of volatility.

Meanwhile, signs of caution continue to appear in capital flows across asset classes. Capital continues to seek a haven in US bonds, keeping the US 10-year treasury note yield depressed below 1.2%. Capital also continues to leave risk markets, most clearly seen in cryptocurrency trading where Bitcoin is down 3.2% today and has dropped back under $30,000. Gold is up 0.4% today after doing little yesterday after the US Dollar surged. Similarly, the Canadian Dollar is steady this morning after a US Dollar jump and an oil price crash knocked the Loonie down over 1% yesterday.

Earnings season has resumed with IBM reporting strong results last night (EPS $2.33 vs street $2.29, sales $18.75B vs street $18.29B). Oilfield service giant Halliburton beat expectations this morning ($0.26 vs street $0.22) along with insurance giant Travelers ($3.45 vs street $2.39). Paint producer PPG Industries disappointed ($1.94 vs street $2.19). Later today, results are due from Netflix, Chipotle Mexican Grill, and United Airlines in the US while Canadian National kicks off earnings on the Canadian side, followed by Rogers tomorrow.  

US housing starts for June beat expectations (1.64M vs street 1.59M). Tonight the Bank of Japan is holding a regularly scheduled meeting.

SIA Wealth In The Media

Chief Market Strategist Colin Cieszynski recently appeared on BNN Bloomberg where he discussed recent weakness in equity and energy markets, relative strength and tactical rotation across asset classes.

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Colin Cieszynski, Chief Market Strategist

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

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