Morning Commentary
Yesterday’s session had a summer-like feel with tight ebbs and flows and a lack of conviction on either side of the trade. Five sectors edged higher, led by Energy (XLE).
Amazing developments on the miracle fat loss drug front sparked buying after the initial sell-off.
Inflation Expectations from the NY Fed saw one-year ahead ease to 3.6% from 3.7% (it was the fifth consecutive monthly decline).
Today, it's all about the Consumer Price Index (CPI) report, which is expected to decline to 3.4% from 3.7% and the Core Consumer Price Index (CPI) at 4.2% from 4.1%.
The Cleveland Fed Nowcast sees a 3.3% headline and a 4.2% Core CPI from a year ago.
The Street is looking for a 0.3% Core CPI from a month ago.
Today’s number is big, but other major data releases will impact the market this week as well.
Portfolio Approach
We are adding a new position in Consumer Discretionary in our Hotline Model Portfolio this morning. If you are not a current subscriber to our Premium Hotline Service, contact your account representative or email Info@wstreet.com to get started today.
Today’s Session
CPI M/M |
Actual |
Consensus |
October |
Headline |
0.0% |
0.1% |
0.4% |
Core |
0.2% |
0.3% |
0.3% |
CPI Y/Y |
Actual |
Consensus |
October |
Headline |
3.2% |
3.3% |
3.7% |
Core |
4.0% |
4.1% |
4.1% |
Inflation resumed its downward trend last month.
Super Core
Jay Powell’s favorite gauge kicks out housing from core services.
Market Reaction
Bond yields are imploding.
Equity futures popped.
I’m excited because we have been positioning. But these numbers are still high, and too much for the average household. The news rekindles hopes for a soft landing.
From our point of view, as investors, this was a good number, and it could spark some panic-buying.
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