The View from 5th Avenue

It almost looked as though the S&P500 saw a ghost today as the index wiped out all of October’s gains (+1.8% as of yesterday’s close, now -6 bps on the month). Or as one economist put it, “it turns out stocks can’t go up each day.” Heavy weights Microsoft and Meta dragged on indices due to their combined $4.5trn market cap, but they weren’t the only companies haunting investors as today’s overflow of earnings underwhelmed in aggregate (details below). On the economic front, we had some importan…

“Life…it is a tale told by an idiot, full of sound and fury, signifying.”

There’s a lot happening over the next seven trading days and that has the Street on edge. But while the various events all have something to monitor closely, the path for equities continues upward for now. Besides earnings, this week’s economic data is packed with employment insights bookended by the nonfarm payrolls Friday. JOLTS this morning fell below estimates (7.443mn versus 8mn) giving Treasuries a brief pop, as openings continue to show a move back towards pre-covid levels (today’s print…

The calm before the storm, with US Presidential Elections just a week away (arguably the last week of normalcy here in the States until the election dust settles), the busiest week of corporate earnings with 42% of the SPX reporting this week (5 of the 7 Magnificent), in conjunction with a handful of key economic data, there is not a moment of dullness on this side of the Atlantic, for better or worse. As we are nearly a third of the way through Q3’s reporting season, ~75% of corporate earnings…

Standing out from the crowd can be a good thing and a bad thing during earnings season and there was certainly more (!) in both categories today as earnings fed through at a ferocious pace. Much of the day was spent trying to decipher the noise, delineate between the risers and fallers, and highlight the macro movers and shakers. But once people came up for air, it was clear there was a split down the middle in terms of bullish and bearish EPS releases. Bulls were quick to highlight Tesla (TSLA…

A mid-week sell of evident today as investors took a step back, focusing on the elephant(s) in the room. With the US election a mere two weeks ago and an outcome that is far from certain investors are struggling for direction, and the macro backdrop is not doing much to help matters either as yields persistently grind higher and the VIX spiked above 20 today. Despite drinking from an earnings fire hose today the close deep in the red for major US indices didn’t feel particularly single stock dr…

The calendar is now only two weeks away from the Presidential election and that is leaving investors in a state of flux. The race is close, and that means the outcomes are tougher to position for until the picture clears. And unfortunately, that may not come right away (if the outcome is as close as the polls are suggesting). Until then, traders are deciphering earnings versus the current index levels and deciding whether those companies justify their current trading levels. Away from earnings,…

A relatively quiet Monday for US equities as investors prepared themselves for the peak of earnings season. With 112 companies in S&P 500 due to report this week, traders will have their hands full as they sift through a plethora of information, in what may the most scrutinized earnings season of the year. It was a choppy day for main US indexes as US treasury rates rose after T. Rowe Price CIO Arif Husain said the US 10y could “test the 5% threshold in the next 6 months” on concerns over risin…

Call me a contrarian but there’s something eerie about a market that just refuses to stop making all-time highs. It’s like waiting for the other shoe to drop only to find out at 4pm each day that we’ve done it again! Onwards and upwards! There are of course a number of reasons to be cautious – the most glaring of which is the US election with polls now showing Trump forging ahead, not to mention the massive government debt pile and continued escalation in the middle east. But truthfully, we’ve…

There was no shortage of moving parts today, beginning overnight with China disappointing the shock-and-awe injection seekers. It was followed by a continued barrage of earnings, a handful of economic data and potentially game-changing geopolitical headlines. Through it all, equity markets held steady, though fell just over the line into negative territory with minutes left to go. The DXY jumped 20bps, treasuries saw selling pressure, and Fed expectations shifted slightly hawkish. The move in…