Morning Dose: Market Eyes September Rate Cut Amid Retail Earnings Mix
A quick analysis of today’s market outlook and key trading opportunities to start your day.
Intro & Market Mood
Equity futures are pointing to a slightly higher open this morning, continuing that quiet drift we saw yesterday. The mood is cautiously optimistic as traders hope for a rate cut at the September FOMC meeting, overshadowing other factors in the market.
Overnight Headlines
The firing of Fed Governor Lisa Cook made headlines, but the market is focused on economic data for a potential rate cut. Important data awaited includes Friday’s PCE data, the Fed’s preferred inflation gauge.
Economic Announcements
- MBA Mortgage Applications Index: Down by half a percent.
Earnings Highlights
- Kohl’s (KSS): Beat earnings per share expectations and guided full-year EPS higher, stock up around nineteen percent.
- Foot Locker: Missed EPS expectations.
- Abercrombie and Fitch: Beat top and bottom lines but guided third-quarter earnings below expectations.
- NVIDIA (NVDA): Earnings announcement after close today anticipated to impact the tech sector significantly.
Top Movers
- Eli Lilly (LLY): Positive results for breast cancer drug, Verzenio; stock up due to positive news and an upgrade to Buy from HSBC.
- Boeing (BA): Contract negotiations with machinists on hold, potentially impacting production.
- SATS (EchoStar): Spectrum bidding war between T-Mobile and Starlink could impact EchoStar, valued at around thirty billion dollars by AT&T.
Quick Trade Ideas
SPY (S&P 500 ETF): Critical support at 640, with immediate resistance at 646 to 650. Watch for a potential rally above 650.
QQQ (Nasdaq 100 ETF): Support around 570, resistance between 575 and 580. NVIDIA earnings could push QQQ higher if positive.
Key Takeaway
Lean into the bullish momentum on industrials, semiconductors, and tech but be prepared for a quick reversal if data challenges the rate-cut narrative. Keep stops tight and monitor closely for potential shifts in market sentiment.
Overall, the market is waiting for NVIDIA’s earnings as the next catalyst amidst a risk-on environment. The calm before the storm indicates a drifting market awaiting direction.
Have a profitable trading day!