Market Alert - Pre-Market

Futures vs FV: SP +9.49; DJ +98.97; NASDAQ +32.24

Futures gapped up to start the session and have worked laterally in the same narrow range ever since. Those gap ranges have a mixed track record in projecting the market direction, but in times such as these coming off a downside session they provide a target for the sellers to take shots at. So, don't take too much upside solace in this higher open.

That said, the futures held up even as some data came in less than anticipated.

Retail sales, Feb: -0.1 vs 0.3 exp vs -0.1 (from -0.3 Jan)

ex-Auto: 0.2 vs 0.4 exp vs 0.1 prior (from 0.0)

Control group: 0.1 vs 0.0 prior.

Second straight negative reading, the first since 10/2015. Very so-so data but it is apparent that auto sales were a factor after that surge in sales post-Harvey and other flooding storms. It does cast some doubts on the consumer.


PPI, Feb: 0.2 vs 0.1 vs 0.4 prior

Core: 0.2 vs 0.2 exp vs 0.4 prior

Core (less food, energy, trade services): 2.7% year/year, the highest ever.

Prices for producers are rising, but the question -- as it always is and has been ever since the 1970's -- is whether it passes through into the CPI. As Tuesday showed, as of February, not.


Earnings beats: SIG, EXPR


Geopolitics: UK/Russia ramp it up over the poisoning of a spy that was traded for. The Spy's Handbook says that when a spy is traded for you don't mess with him/her anymore. UK claims Russia broke that rule, Russia shakes its missiles at UK, UK now expels 23 diplomats, freezes Russian assets.


OTHER MARKETS
Bonds: 2.852 vs 2.844

EUR/USD: 1.2373 vs 1.2392

USD/JPY: 106.50 vs 106.47

Oil: 61.25, +0.54

Gold: 1326.20, -0.90


Futures are range bound premarket. A gap open is coming, but want to see how it holds given the action yesterday that saw a gap higher get sold and saw NASDAQ give up a break to a fresh new high on some volume.

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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