Market Alert - Pre-Market

Futures vs FV: SP -5.03; DJ -30.11; NASDAQ -15.18

You ever here the one about stagflation . . .? Macy's utterly bombs on earnings and sales, missing already terrible expectations by almost 2x. Then producer prices surge the most in 5 years. Economic data is relative awful, not exactly the stuff of great recoveries, indeed backsliding into recession. Of course most Americans never felt they ever LEFT the 2008-09 recession.

What makes it particularly bitter for them is they THOUGHT they were going to get help. Thus far, nada. The Comey firing continues to lead the headlines and one wonders why Trump just did not fire every holdover from the Obama era. That is the only way to effectuate what the voters elected him to do, but instead it is a bit by bit bleeding. Hack it off, slap a tourniquet on it, move on.

But, I digress.

Futures are lower and the market will start lower today after NASDAQ melted to a higher high and SOX gapped to a higher high then rallied. Of course that means the NYSE indices are still in their lateral moves. That will really help to build more anxiety and frustration in the market, again, in our view, good for the upside.

Futures are not that bad, but of course any negative start of more than a couple of S&P points has people calling for the end of times.

PPI: 0.5% vs 0.2% exp vs -0.1% prior. Year/year: 2.5%, the highest since 2/2012.

Core: 0.4% vs 0.2% exp vs 0.0%


Oil: Saudi Arabia predicts a surge in shale oil production even as its own production climbs. Throwing in the production cut towel? It is noteworthy that oil is higher on the day AND that stocks are lower. Where is that nexus between the two that was being tossed around yesterday about if oil struggles the market struggles and vice versa?


M&A: VZ buying STRP, confirmed. Norgia BV buying MSLI


Earnings: M is the big miss. All retailers are in the toilet in the aftermath of that earnings dump, so to speak.


OTHER MARKETS
Bonds: 2.414% versus 2.410%. Bonds continue to fade.

EUR/USD: 1.0855 VS 1.08671

USD/JPY: 113.978 VS 114.253. Dollar taking a breather.

Oil: 47.94, +0.61. Oil continues higher even as Saudi Arabia forecasts surging shale oil production.

Gold: 1220.90, +2.00


Futures are off the morning lows but after a bounce the past 40 minutes they are stalling their recovery toward the opening bell. Could it be that the Trump travails are catching up? We will see. Still a lot of good patterns out there and more forming up. This is not huge for now, and if the landscape remains the same, this kind of action helps set up some bases better.


Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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