Friday Morning Reads

Friday Morning Reads

Morning Reads









S&P 500 futures trade six points, or 0.1%, above fair value on this New Year's Eve, as the market looks to end an impressive year on a quiet note.

Once again, there isn't a specific catalyst driving the futures market, and trading volume is expected to be thin with many participants taking the day off for the new year. Several markets in Asia and Europe were closed today while others closed early. The U.S. stock market will be open for a full day of trading.

Conditions are ripe for profit taking, but sellers have had a hard time exerting influence on the market. That could always change as the day progresses, as observed yesterday into the close.

Highlighting some of the morning's headlines, Columbia University researchers believe coronavirus cases in the U.S. will peak in the middle of January, according to the Washington Post. The White House said President Biden and Russian President Putin discussed the importance of pragmatic, results-oriented diplomacy.

U.S. Treasury yields have edged lower. The 2-yr yield is down one basis point to 0.73%, and the 10-yr yield is down two basis points to 1.50%. The U.S. Dollar Index is little changed at 95.93. WTI crude futures are down 1.7%, or $1.28, to $75.71/bbl.

In U.S. Corporate news:

  • Peloton (PTON 36.75, -0.44): -1.2% after the stock was downgraded to Mkt Perform from Mkt Outperform at JMP Securities, citing declining website traffic read throughs.
  • Advanced Micro Devices (AMD 146.24, +1.09): +0.8% after pushing back the timing of its Xilinx (XLNX 209.25, -4.64, -2.2%) acquisition close into 1Q22. The two companies previously expected to close the deal by the end of this year.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended 2021 on a mostly higher note, though markets in South Korea and Japan were closed throughout the day while markets in Australia, Hong Kong, and Singapore closed early. Japan's Nikkei: CLOSED (+4.9% in 2021) Hong Kong's Hang Seng: +1.2% (-14.1% in 2021) China's Shanghai Composite: +0.6% (+4.8% in 2021) India's Sensex: +0.8% (+22.0% in 2021) South Korea's Kospi: CLOSED (+3.6% in 2021) Australia's ASX All Ordinaries: -0.8% (+13.6% in 2021).
    • In economic data:
      • China's December Manufacturing PMI 50.3 (expected 50.0; last 50.1) and December Non-Manufacturing PMI 52.7 (expected 52.0; last 52.3)
      • South Korea's December CPI 0.2% m/m (expected 0.1%; last 0.4%); 3.7% yr/yr (expected 3.6%; last 3.7%)
      • India's November Infrastructure Output 3.1% yr/yr (last 7.5%)
    • In news:
      • South Korea's CPI increased at its fastest yr/yr pace in a decade in the December reading.
      • China's Manufacturing PMI reached its highest level since July.
      • Xinhua reported that railway traffic during the Spring Festival is expected to be up 29% yr/yr.
  • Equity markets in Germany, Italy, Spain, and Switzerland are closed in observance of New Year's Day. STOXX Europe 600: -0.1% (+21.4% in 2021) Germany's DAX: CLOSED (+15.7% in 2021) U.K.'s FTSE 100: -0.6% (+13.9% in 2021) France's CAC 40: -0.5% (+28.6% YTD) Italy's FTSE MIB: CLOSED (+23.0% in 2021) Spain's IBEX 35: CLOSED (+7.9% in 2021).
    • In economic data:
      • There was no notable data
    • In news:
      • Russian officials said that a phone call between Presidents Biden and Putin went well and that their conversation will continue in early 2022.

Today's Markets

In Asia, Japan -0.4%. Hong Kong +0.1%. China +0.6%. India flat.
In Europe, at midday, London +0.1%. Paris +0.3%. Frankfurt +0.1%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -0.8% at $75.98. Gold -0.2% at $1803. Bitcoin -0.5% at $47409.
Ten-year Treasury Yield -1 bps to 1.53%

Today's Economic Calendar

8:30 Initial Jobless Claims
9:45 Chicago PMI
10:30 EIA Natural Gas Inventory
1:00 PM Baker-Hughes Rig Count
3:00 PM Farm Prices
4:30 PM Fed Balance Sheet

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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