Morning Reads







This Morning

Poised to close out another winning week on a high note

The S&P 500 futures are up 16 points and are trading 0.4% above fair value. The Nasdaq 100 futures are up 57 points and are 0.3% above fair value. The Dow Jones Industrial Average futures are up 112 points and are trading 0.5% above fair value.

Futures for the major indices have a positive bias this morning with the S&P 500 on track for a fourth consecutive winning week. 

The House will vote on the Inflation Reduction Act today where it's expected to pass. Also, the CDC issued new guidelines that remove the quarantine recommendation for people exposed to Covid-19.

There is weakness in a number of Chinese ADRs following the news that several companies, China Life Insurance (LFC), PetroChina (PTR), China Petroleum (Sinopec) (SNP), Alum. Corp China (ACH), and Shanghai Petrochemical (SHI), plan to delist at the NYSE.

Energy complex futures are moving lower this morning. WTI crude oil futures are down 1.5% to $92.93/bbl. Natural gas futures are down 3.2% to $8.59/mmbtu.

The 2-yr note yield is unchanged at 3.19% while the 10-yr note yield is down two basis points to 2.87%.

In corporate news:

  • Toast (TOST 20.51, +2.36, +13.00%): beats by $0.01, beats on revs; guides Q3 revs above consensus; raises FY22 revs guidance above consensus
  • Illumina (ILMN 193.55, -33.89, -14.90%): misses by $0.07, misses on revs; cuts FY22 EPS, revs expectations
  • Rivian Automotive (RIVN 38.64, -0.31, -0.80%): beats by $0.01, beats on revs, reports R1 preorder backlog of 98,000 vehicles; Reaffirms 2022 production target of 25K vehicles, lowers capital expenditure guidance
  • Olo Inc. (OLO 8.77, -4.22, -32.49%): beats by $0.01, reports revs in-line; guides Q3 revs below consensus; lowers FY22 revs below consensus
  • Payoneer (PAYO 6.79, +1.11, +19.54%): beats by $0.07, beats on revs; guides FY22 revs above consensus
  • Alibaba (BABA 92.07, -2.80, -2.95%): Lower in response to news that several Chinese companies announced plans to delist at the NYSE.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Japan's Nikkei: +2.6% (+1.3% for the week), Hong Kong's Hang Seng: +0.5% (-0.1% for the week), China's Shanghai Composite: -0.2% (+1.6% for the week), India's Sensex: +0.2% (+1.8% for the week), South Korea's Kospi: +0.2% (+1.5% for the week), Australia's ASX All Ordinaries: -0.5% (+0.5% for the week).
    • In economic data:
      • China's July New Loans CNY679.0 bln (expected CNY1.10 trln; last CNY2.81 trln) and July Total Social Financing CNY756.1 bln (expected CNY1.30 trln; last CNY5.17 trln)
      • South Korea's July Import Price Index 27.9% yr/yr (last 33.6%) and Export Price Index 16.3% yr/yr (last 23.7%)
      • Hong Kong's Q2 GDP 1.0% qtr/qtr (last -0.9%); -1.3% yr/yr (last -1.4%)
      • New Zealand's July FPI 2.1% m/m (last 1.2%) and July Business NZ PMI 52.7 (last 50.0)
    • In news:
      • Japan's Prime Minister Kishida said that his government will announce more measures to deal with high energy and food prices.
      • Fitch noted that China's money market fund became the world's second largest money market fund in Q2, overtaking Europe.
      • New Zealand's Manufacturing PMI expanded for the 12th consecutive month in July.
  • Major European indices trade near their flat lines. STOXX Europe 600: -0.1% (+0.9% week-to-date), Germany's DAX: +0.3% (+1.2% week-to-date), U.K.'s FTSE 100: +0.2% (+0.5% week-to-date), France's CAC 40: UNCH (+1.2% week-to-date), Italy's FTSE MIB: +0.2% (+1.4% week-to-date), Spain's IBEX 35: +0.3% (+2.9% week-to-date).
    • In economic data:
      • Eurozone's June Industrial Production 0.7% m/m (expected 0.2%; last 2.1%); 2.4% yr/yr (expected 0.8%; last 1.6%)
      • U.K.'s Q2 GDP -0.1% qtr/qtr (expected -0.2%; last 0.8%); 2.9% yr/yr (expected 2.8%; last 8.7%). Q2 Business Investment 3.8% qtr/qtr (expected -0.3%; last -0.6%); 5.0% yr/yr (last 8.3%). June Industrial Production -0.9% m/m (expected -1.3%; last 1.3%); 2.4% yr/yr (expected 1.6%; last 1.8%). June Manufacturing Production -1.6% m/m (expected -1.8%; last 1.7%); 1.3% yr/yr (expected 0.9%; last 2.6%). June Construction Output -1.4% m/m (expected -1.5%; last 1.8%); 4.1% yr/yr (expected 3.3%; last 4.9%)
      • France's July CPI 0.3% m/m, as expected (last 0.8%); 6.1% yr/yr, as expected (last 5.8%). Q2 Unemployment Rate 7.4% (expected 7.3%; last 7.3%)
      • Italy's June trade deficit EUR2.166 bln (expected surplus of EUR350 mln; last deficit of EUR62 mln)
      • Spain's July CPI -0.3% m/m (expected -0.2%; last 1.9%); 10.8% yr/yr, as expected (last 10.2%)
    • In news:
      • Germany's economy ministry expects the country's economy to worsen in the second half due to lower gas deliveries, higher energy prices, and continued supply chain issues.
      • Drought conditions have been declared across half of England.
      • CPI readings from France and Spain increased at their fastest yr/yr rates since 1985.

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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