Market Alert - Pre-Market

Futures vs FV: SP -2.64; DJ -11.10, NASDAQ -13.10

After the Thursday reversal that some say is the result of the killing of the UK parliament member as Brexit fears ebbed, stocks are mixed, trading around the flat line. While no major damage or gains are being logged, it is not a good indication that stocks have lost that momentum.

Housing Starts, May: -0.3% vs 4.9% prior (from 6.5%)

Permits: 0.7%

Single family stagnant. Multi-family slower, but still rising. Still not enough purchasing versus renting. We keep hearing about a lack of supply. So why are not builders building like crazy in those areas were supply is reportedly low? More inconsistencies in the data or is it the monetary policy and fiscal policies making it more lucrative to build certain kind of homes than to meet the demands of the entire market? Would not be the first time imbalances are created by those who are supposed to work to lessen and avoid imbalances.

AAPL: Beijing bans sale of iPhone 6. This is the next step in what I reported on months ago about how China was going to stop the sale of iPhones. It is happening.

M&A: REV buying RDEN in cosmetics area

Fed: Bullard, the supposed hawk, goes full frontal dove, stating only 1 rate hike needed . . . THROUGH 2018!

Brexit: Seen as less likely given the murder of the parliament member. That does not change the facts as to how the EU is bad for the UK, but Brits are funny that way.

Earnings: SWH profit up 20% for quarter. Sales up 200% since Obama elected. Projects strong growth in sales for the next 10 months. Dealers are selling out of AR style guns. One is selling 19/hour. Another sells 2,000/week.


OTHER MARKETS
Bonds: 1.594 vs 1.57% 10 year. Off the surge of late as some of the Brexit fears concern.

EUR/USD: 1.1256 vs 1.1218

USD/JPY: 104.29 vs 104.282

Oil: 47.27, +1.06

Gold: 1294.20, -4.20


NASDAQ is getting hammered in the pre-market, AAPL not helping. It looks, however, as if growth is getting the hits today. It is expiration; could see some strange moves as a result. Tech was a surprise leader upside (software) and that is causing some expiration ending moves.

We will see if the momentum returns, but again, the lack of follow through from the Thursday low to high move is not that positive for the upside.


Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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