Futures vs FV: SP -2.78; DJ -12.3; NADSAQ -4.05
There is actually some economic news today, potentially positive, but the markets are not buying it whether equities or bonds.
In a 'Mornings with Maria' interview, the President answered questions about tax reform and healthcare, etc. Trump went back to the 'healthcare before taxes' as the best approach. Congressman Mark Meadows of the Freedom Caucus is today saying that they are 'very close' to a deal on healthcare. Again. As noted, the market is not buying it, and thus if they are successful there will be a rally. THAT is what the market is waiting on at this point. If it doesn't come, the geopolitical issues can lead to further selling.
Import Prices, March: -0.2% as expected vs 0.4 prior. 4.2% year/year versus 4.8% prior
Imports ex-oil: 0.2% vs 0.3% prior
Exports: +0.2% vs 0.3% February.
Jobs: WMT is reportedly cutting 'hundreds of jobs' in an effort to keep pace with Amazon. The cuts are white collar, again, in international, Sam's Club, and tech divisions.
Russia: Tillerson gets cold shoulder in Russia, Putin won't meet with him, instead issuing a statement saying 'trust between Russia and US has collapsed.' Very interesting dynamic. For the FIRST TIME, Putin has to deal with a strong US President. Bush was hoodwinked, Obama was disengaged, Russia could do what it wanted. Putin does not know how to deal with Trump, someone who will act if he feels necessary. So Putin is trying the hard line, the only thing he knows. He is not stupid. I remember him making a fool of Michael Dell when a bunch of US tech CEO's went to Russia, met with Putin, and Dell almost condescendingly asked Putin 'what can we do to help you?' Putin responded 'we don't need your help.' Ouch.
France election: Panic in France as the communist candidate continues gaining in the polls. What do you expect? A socialist country where the policies are causing great disruption. They go to even more leftism as that is what they are trained in. Goodbye Europe.
China: Trump calls Xi. Further planning re NKorea?
Idiocy: Sweden's largest newspaper calls for a law to ban men driving cars to 'end terrorism.' How about banning idiots from writing for newspapers? Will that end the idiotic things newspapers print?
Bonds: 2.291% vs 2.30% 10 year. Bonds are still rallying.
EUR/USD: 1.0600 VS 1.0606
USD/JPY: 109.507 vs 109.691. Dollar still dropping versus yen
Oil: 53.68, +0.28. Still rallying toward the 54-55 resistance
Gold: 1277.30, +3.10. Still pushing the Tuesday break through the 200 day MA
Futures are near morning lows as the bell approaches. Tuesday started lower and sold hard before a decent-ish recovery. Will bids return again? Will FAANG stocks shake off Tuesday? Chips? Watching those areas and watching RUTX, SP400 to see if those can continue leadership. If so and the others still languish, you are seeing rotation out of areas into new areas, but no new money coming in, just moving it from one area to another. That shows less confidence in the market moving up, but not ready to sell it.
Jon Johnson, Chief Market Strategist
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