It was a doomed session out of the gate yesterday, but stocks held on and held up better than they had a couple of weeks ago on the same news.

• S&P 500: -1.15%
• Nasdaq Composite (Comp): -1.89%
• Russell 2000 (RUT): -0.69%

Three defensive sectors were higher. While the top performer list was eclectically driven by earnings beats.

• (MMM) 3M Co.
• (GE) General Electric Co.            
• (ADM) Archer-Daniels-Midland Co.
• (FISV) Fiserv Inc
• (ARE) Alexandria Real Estate Equities Inc.   
• (NEM) Newmont Corp. 

• (FFIV) F5 Inc.     

Philly Fed: From Inflation to Recession

The headline activity came in at -12.3, well below the consensus of 0.1. Back-to-back declines gained speed and should have gained more attention. Employment was a big red flag:

• Full-time (FT): 14.3 from 27.7
• Part-time (PT): 8.6 from 21.7

 

 

Price Relief

• Prices paid: 63.8 from 80.0
• Prices received: 32.5 from 33.6

New home sales crumbled as home prices slumped on a spike in supply.

• Median home price $402,400 from $444,500
• Average home prices $456,800 from $514,000 and $569,300 in May

Key Charts

The fear index (VIX) got very close to its 50-day moving average and made a strong bounce. I’m watching 27.17, the 50-day moving average for a breakout, which would mean pressure on the equity market.

The Fed is said to be watching the 10-year and 3-month yield curve as a confirmation of a recession. It is getting super close just as the Federal Open Market Committee (FOMC) wraps up today.

Portfolio Approach

There are not sector weighting changes this morning in our Hotline Model Portfolio.

Today’s Session

Lots of economic data to comb through until we get to the FOMC decision at 2PM. 

The report that stands out the most is Durable Goods.

Headline new orders +1.9% for June is significantly better than -0.5% consensus and the highest level since January.

Business Investment

Orders for non-defense capital goods, excluding aircraft in the United States, +0.5% coming in better than +0.2% consensus.

Earnings Front

As of last night, 70% of S&P 500 names beat on revenue with blended return of 11.6%, and 76% beat on earnings per share with 6.2% blended return.

Revenue and earnings are coming in above consensus.

Earnings beats and misses don’t seem to matter this morning, as some of the highest profile movers on the upside all missed either the top or bottom lines.  Some missed both.

• Alphabet (GOOG)
• Boeing (BA)
• Microsoft (MSFT)
• Spotify (SPOT)

Now, we wait on Powell & Co. 

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.