Morning Reads


Todays Open Interest Change




Economists and analysts are clearly divided about the latest inflation report card, but markets seem to think otherwise. The Consumer Price Index dropped to 3% Y/Y in June, down from a 4% headline rate in May, while core inflation - which excludes volatile food and energy prices - only grew by 0.2% M/M, after climbing by 0.4% or more for the past six months. Following the data release, the S&P 500 (SP500) and Nasdaq (COMP.IND) ended Wednesday's session at their highest levels in over a year as optimism builds about a soft landing for the U.S. economy.

The good: "The roots of a further decline in the rate of inflation are well established and should support a continuation of the bull market in stocks," wrote Investing Group Leader Lawrence Fuller. "While the core rate remains well above target, the roots of its decline are staring us in the face. The inflation hawks will do their best to find components of the price index that are not falling in line with the overall rate, but they will come up empty-handed." Inflation Keeps Declining And Stocks Keep Climbing (19 comments)

The bad: "Though positive, the CPI report isn't expected to change the outcome at the Federal Reserve's July 25-26 meeting," said SA analyst Justin Purohit. "By moving forward with continued increases, the Fed risks overshooting key components whose deceleration is expected to increase in the back half of the year. With these considerations in mind, I believe the Fed is on track for a policy mistake." June CPI Report: What It Means For Consumers And Markets (11 comments)

The ugly: "On the surface, the easy part of the inflation cycle appears to have been completed. The core measure of inflation is undoubtedly better than where they were, but the Fed isn't likely to take much comfort in one month of better data," added Mott Capital Management. "Core goods and services are still relatively high, even after modest improvement. It will put into question the fantasy the stock market has had now for some time that inflation is just going to vanish and melt away... and based on the data, the hard part for the markets is likely only beginning." The Inflation Battle Is Far From Over, Now The Hard Part Begins (24 comments)

Double strike

Hollywood is gearing up for the first double strike of writers and actors since 1960 after contract negotiations between a union representing 160,000 actors and major studios failed. Actors are now set to join writers, who have already been on the picket lines for more than two months. The SAG-AFTRA voted to recommend a strike and its national board will make the final decision today. "After more than four weeks of bargaining, the Alliance of Motion Picture and Television Producers remains unwilling to offer a fair deal," said SAG-AFTRA. AMPTP represents major studios and streamers including Apple (AAPL), Disney (DIS) and Netflix (NFLX). (11 comments)

More time

It's not easy for Bob Iger to retire. He'll remain at the helm of Disney (DIS) for two years longer than planned after the company extended the CEO's employment contract to December 2026 (Loop Capital called it). Iger has delayed many succession decisions in the past, but ultimately extended his tenure, and took investors by surprise when he returned to Disney last year to replace Bob Chapek. Current Chairman Mark Parker said the new contract extension would give Disney "ample time to position a new CEO for long-term success," with the House of Mouse continuing to evaluate internal and external candidates for the top spot. (111 comments)

New rules

The Securities and Exchange Commission has adopted measures to reduce the risk of investor runs on money market funds, a $5.5T industry, during times of market stress. The SEC had passed rules to prevent such runs after financial markets spiraled in 2008 and 2020, but these efforts failed to stop investors fleeing these funds. The latest measures increase minimum liquidity requirements to provide a bigger buffer in the event of rapid redemptions, among other changes. Trade group SIFMA is cautious about the changes, given additional costs on shareholders, but is relieved that the SEC didn't implement swing pricing. (2 comments)

Today's Markets

In Asia, Japan +1.5%. Hong Kong +2.6%. China +1.3%. India +0.3%.
In Europe, at midday, London +0.4%. Paris +0.8%. Frankfurt +0.6%.
Futures at 7:00, Dow +0.2%. S&P +0.3%. Nasdaq +0.7%. Crude +0.2% to $75.88. Gold +0.2% to $1,964.70. Bitcoin -0.3% to $30,590.
Ten-year Treasury Yield -4 bps to 3.82%.

Today's Economic Calendar

8:30 Initial Jobless Claims
8:30 Producer Price Index
10:30 EIA Natural Gas Inventory
1:00 PM Results of $18B, 30-Year Bond Auction
2:00 PM Treasury Statement
4:30 PM Fed Balance Sheet
6:45 PM Fed's Waller Speaks on Economic and Policy Outlook

Companies reporting earnings today »

What else is happening...

Microsoft (MSFT)-Activision (ATVI): FTC appeals ruling on $69B deal.

Broadcom's (AVGO) takeover of VMware (VMW) gets conditional EU nod.

Musk unveils xAI to 'understand reality' and 'true nature of universe.'

Microsoft (MSFT) says Chinese hackers accessed 25 organizations.

Deeper Dive: The music industry is growing louder with new ETF.

Viasat (VSAT) falls 10% after flagging deployment issue in satellite.

U.N. chief to Putin: Extend Black Sea grain deal for SWIFT access.

BP (BP), TotalEnergies (TTE) win in €12.6B offshore wind site auction.

BlackRock (BLK), KKR (KKR) near sale of ADNOC oil pipeline stake.

Google (GOOGL) expands access to AI bot Bard, with new image features.

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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