Market Alert - Pre-Market

Futures vs FV: SP +6.48; DJ +55.45; NASDAQ +31.21

Talk of a 'tax reform consensus' developing is credited for helping futures recover. Hmmm. That is not bad news, though some of the 'consensus' details are less than exciting with lots of deduction eliminations (mortgage, state & local taxes) and the corporate rate in the 22.5% to 25% range. Not enough, not enough. Give the big corporations a 15% repatriation, give true small businesses 15%, put the big corps at 25% for now. We need small businesses to start and grow. They create 75% of the jobs. Why are they not the focus of any tax reform? They are the ones crushed by the current tax scheme from the ACA, regulations, etc. Oh, this is the government at work. Never mind.

As noted last night, there is not a lot of scheduled data and there is just not a lot of news. Perhaps it is simply a boredom kind of move: sold hard, then once again, nothing. That allows bids to creep back in and next thing you know there is a recovery underway. Seen it before in this market.

Earnings beats: DSW

Misses: TOL (TL); COTY (BL); MDT (TL)


Trump: Seen as more 'presidential' in his Afghanistan address. Then tonight he goes to Phoenix for a rally. Yen and yang.


FB: An analyst predicts that teen usage (12 to 17) is 'going to' decline over the next year. News flash: they already don't use it. They left at least 2 years ago. I was talking about posting business items on FB back then and the kids told me they hoped I was not trying to reach teens because FB was an 'old folks' social media service and everyone was on Instagram or snapchat. The point: FB was not hurt at all by the exodus of the teens.


OTHER MARKETS

Everything giving back some on their recent trends as stocks show some backbone.

Bonds: 2.208% vs 2.183% 10 year. Bonds are off some after a bounce in their continuing bullish pattern.

EUR/USD: 1.1763

USD/JPY: 109.26

Oil: 47.25, -0.12

Gold 1292.00, -4.70


Okay, futures are off the morning highs hit just under 1 hour back. There is a trend for the morning, however, rising all session versus a gap higher that just hangs out. That is better for the upside showing more staying power. Again, after that Thursday selloff was not pushed by the algos, the market just sat, and now there is a glimmer of decent news and the bids are returning.



Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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