Morning Dose: Market Watch Gloomy Futures Signal Volatility Ahead
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! Futures are signaling a bit of a gloomy start this morning, with S&P 500 futures trading about 29 to 31 points below fair value. This comes after a six-day win streak for the S&P 500, suggesting a possible pause and profit-taking.
Overnight Headlines
- Asia: Hang Seng and Shanghai Composite up; Nikkei down; Japanese government bonds face poor demand
- Europe: Mixed with Germany’s DAX, UK’s FTSE, and France’s CAC down; UK’s CPI higher than expected for April affecting rate cut hopes
- Central Banks: ECB cautious on rate cuts due to wage growth concerns; Bank of England’s rate cut hopes dampened by high UK CPI
Economic Announcements
Quiet day for US economic data with MBA Mortgage Applications and EIA Crude Oil Inventories expected, along with a significant auction of $16 billion in 20-year bonds by the Treasury. Treasury yields are rising ahead of the auction.
Earnings Highlights
- Target (TGT): Misses Q1 expectations, lowers sales guidance, stock down about 3.5%
- VF Corp (VFC): Struggling after missing revenue, down around 13.6%
- Canada Goose (GOOS): Beat expectations, stock up over 7%
- Dycom (DY): Strong report with beat and guidance raise, stock up over 6%
Top Movers
- UnitedHealth (UNH): Down 6.5% following a downgrade
- Wolfspeed (WOLF): Plunges about 57% amid bankruptcy rumors
- Keysight Technologies (KEYS): Up around 4.7% after earnings beat
Quick Trade Ideas
The WaveRider AI reports point to strength in tech (XLK) and financials (XLF), with energy (XLE) showing some resilience but lagging slightly. Watch for selective entries in technology and healthcare stocks showing momentum like Keysight (KEYS) and Nvidia (NVDA).
Key Takeaway
Futures are pointing to a lower open with mixed global markets, inflation concerns in the UK, and a light day for US economic data. Earnings are varied with notable disappointments like Target and VF Corp. Stay vigilant at key technical levels, watch bond yields, and be prepared for individual stock volatility.