Market Alert - Pre-Market

Futures vs FV: SP +3.11; DJ +40.11; NASDAQ -9.25

Not sure this open is what the market needs. Futures were sharply lower overnight on top of the losses during the Thursday regular session. That was good. Then the futures recovered starting 6:00ET. Most of the losses erased. The best would have been another selloff that took DJ30 to the February lows and SP500 to or near them. Now the pressure is removed and sellers have not got it out of the system yet.


Tariffs: Still the major topic as China retaliates with $3B of its own. Not anything near the $60B by the US as it hits cherries, macadamia nuts and the like. The big issue is China appropriating IP. China knows it, we know it, the rest of the world knows it and we are finally calling them out on it. If the rest of the world will participate in one of the favorite trends of the day, i.e. 'me too,' China would likely be forced to modify its stealing.


Budget Bill: The GOP is a dysfunctional pile. It 'negotiates' a $1.3T spending spree, giveaway bill that caved on every spending plan anyone ever had -- other than the leader of their party. DACA not mentioned, no funds for a border wall. Of COURSE Trump is threatening to veto it and he should. Goodness.


Durable Goods orders, Feb: 3.1% vs 1.5% vs -3.5% Jan (from -3.7%)

Ex-Transports: 1.2 vs 0.6 exp vs -0.2 prior (from -0.3)

Business investment: 1.8% vs 0.9% ex vs -0.4 prior (from -0.3%)


Fed: Bostic says the Fed is 'at or near' its goals, and of course more rate hikes are needed. Duh.


Earnings beats: NKE; M; CTAS

Miss: KBH (TL)


OTHER MARKETS
Bonds: 2.839% vs 2.80%. Bonds fade, yields rebound after the Thursday rally.

EUR/USD: 1.234 vs 1.2328

USD/JPY: 105.06 vs 104.86. Dollar recovers some From Thursday beating

Oil: 64.78, +0.48

Gold: 1346.60, +19.20


Futures are rising still as the open approaches, and that has brought SP, DJ to positive and NASDAQ is moving that way. Not the best action. The market needed to sell off at the open. With this rise to the open be prepared for the sellers to return at some point. It is Friday and that means short covering after such a sharp selloff, but it might be that there is a midmorning to early afternoon rollover before some more short covering in the afternoon session.

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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