Morning Minutes

US Q2 GDP, Earnings, Fed and Infrastructure In Focus




US index futures are generally positive varying between flat for NASDAQ futures to up 0.4% for Dow futures with the Dow bouncing back from yesterday’s 0.4% decline and the NASDAQ consolidating yesterday’s 0.7% gain. The Fed continued to support markets yesterday with upbeat talk on the economy but not committing to cutting stimulus in the near term. The central bank also formalized ongoing support of money market liquidity by entrenching two new ongoing repo facilities totaling $500B. On the fiscal support side, meanwhile, Congress appears to be moving forward with a $550B infrastructure spending program that both parties have agreed to support.

The US announced an even stronger than expected Q2 GDP report (6.1% vs street 5.4% and previous 4.3%) this morning, which indicates wider reopenings helped to accelerate the economic recovery.      US weekly jobless claims were mixed, improving from last week, but not as much as the street had hoped. (400K vs street 380K and previous 419K)

It’s another big day for earnings but results have been a bit more mixed. Ford posted a surprise profit (+$0.13 vs street -$0.03) and Qualcomm ($1.92 vs street $1.68) handily beat expectations. On the other hand despite beating the street on earnings, Facebook ($3.61 vs street $3.03) and Paypal ($1.15 vs street $1.12) are down in premarket action after posting soft guidance. headlines another large slate of companies reporting after the close today followed by a number of heavyweights reporting tomorrow morning including ExxonMobil, Chevron, Caterpillar and Mastercard.

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Colin Cieszynski, Chief Market Strategist

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

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