Morning Dose: Market Alert CAT Tariff Shock & Key Economic Data Impact
A quick analysis of today’s market outlook and key trading opportunities to start your day.
Intro & Market Mood
Welcome to The Morning Dose – Everything You Need to Know Before the Market Opens. It’s Friday before a long weekend with a bit of red on the screen as the bulls take a breather. The S&P 500 hit a record high yesterday, but futures are pulling back.
Overnight Headlines
- Caterpillar (CAT): Warning of higher tariff costs, impacting operating profit margin and raising market concerns about expanded Section 232 tariffs.
Economic Announcements
The key focus is the Personal Income and Spending report at 8:30 AM, which includes the crucial PCE Price Index that the Fed closely monitors. Expectations are high due to signals of a possible September rate cut.
Earnings Highlights
- Winners:
- Affirm: Revenue beat, GMV up 43%.
- Ambarella, Autodesk, Elastic: Posting strong pre-market gains.
- Ulta Beauty: Beat earnings, raised guidance.
- Losers:
- Marvell Technology: Down 13% despite meeting expectations.
- Dell: Dropped over 6% due to weak guidance.
Top Movers
Sectors: Energy and real estate showing strength, with notable recent rotation towards energy. Key ETF support and resistance levels for SPY and QQQ highlighted for traders.
Quick Trade Ideas
- Watchlist: NVMI for strength continuation, Tesla for broader market reaction potential.
Key Takeaway
The market is cautiously bullish but volatile, influenced by profit-taking, tariff fears, and anticipation of the PCE inflation report’s impact on Fed expectations. Traders advised to focus on strong sectors like energy and monitor PCE data closely.