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US equity futures are trading higher following gains yesterday on the first trading day of 2022. Additional companies will report auto sales today following Tesla’s (TSLA) strong Q4 numbers over the weekend. Omicron cases continue to rise across the U.S. as health officials predict that certain areas of the country will reach a peak later this month. Several businesses and schools are being impacted by staffing issues related to Omicron infections.
Asia markets were mixed. The December Caixin Manufacturing PMI for China was 50.9 vs. 49.9 prior. China’s Yuzhou, which has a population of 1.3 million, was put on a partial lockdown due to coronavirus.
In Europe, markets are mostly higher.
Treasury Yields are pressing higher with the 30-year pushing to 2.06%, testing its 200-sma for the first time since late October. The 10-year bolts to 1.67% and is eyeing up a test of the 52-week high of 1.67% set back in early April. The 5-year rallied to 1.39% and is at its highest level since the start of the pandemic. The debate behind the moves (inflation vs growth) will continue but it should bode well for the banking sector. Our FAS long is pushing above the 50-sma ($135) in early trade.
Smart Global (SGH) reports earnings after the close. The Brazilian chipmaker will provide us early insight into the supply chain issues for semis. SGH shares have been on a tear since mid-December when it broke above the $62 level. Stifel was out saying it expected a strong set of results from the company which would provide further evidence of positive changes to the overall business and operating models. Still, we may see some profit taking ahead of tonight’s results.
Another Strong Close In Europe with Another Record High for France’s CAC, +1.3%
German DAX, +0.7%
Italy’s FTSE MIB +0.4%
Spain’s Ibex +0.6%
UK’s FTSE 100, +1.5%Dow 36,799.65 214.59 0.59%
S&P 500 4,793.54 -3.02 -0.06%
Nasdaq 15,622.72 -210.08 -1.33%
GlobalDow 4,213.75 51.38 1.23%
Gold 1,815.50 15.40 0.86%
Oil 76.93 0.85 1.12%Mixed disposition in futures market; Nasdaq 100 futures underperform
Growth trailing value by large margin to start the year
Omicron causing staffing issues across various industries
Republicans and Democrats said to be discussing possibility of additional COVID relief funding
BA up modestly on reports of possible purchase order from ALGT
BYND rallies on news of KFC deal
WMT gains after announcing plan to expand InHome delivery reach
Ratings changes for: ADBE, CRM, AMP, CAKE, CVX, EMR, INTC, ALGT, AMT, AMGN, BP, DPZ, EL, AMAT, BLDP, and BYND
Oil futures up modestly
Treasuries steady ahead of FOMC Minutes release at 2:00 p.m. ETWhat’s also striking is that the CBOE Volatility Index has remained subdued in the face of the growth stock selling. It’s flat today at 16.91 and down 1.8% for the week, suggesting that the weakness in the growth stocks might be thought of more as a rebalancing maneuver than anything that is going to be a killjoy for the broader market. That view is subject to change, but there isn’t a true, fear-based resonance in the market at this juncture.
Bond Update: Ahead of FOMC minutes 2-yr note has slipped to a fresh low as shorter tenors slip
2-yr +3 bps to 0.79%
3-yr +3 bps to 1.04%
5-yr +1 bp to 1.38%
10-yr -1 bp to 1.66%
30-yr -2 bps to 2.06%
#TILT #Bonds #SPXBritish pound hits 8-week high
UK Prime Minister Boris Johnson: We do not need to shut down our country again.
Leaders around the world are weighing whether their healthcare systems can handle the strain of omicron and acting accordingly.
The pound hasn’t traded off of omicron but it’s now at an 8-week high. At this point, there’s probably an advantage to high infections as it makes the country more resilient going forward with the combination of good vaccine uptake and high post-infection immunity. There’s also something to be said for more-engaging attitudes of consumers who have been previously infected with mild cases.
Ohhh the Humanity … FED may raise 0.75 BPS in 2022 – lol
Dow 36,407.11 -392.54 -1.07%
S&P 500 4,700.58 -92.96 -1.94%
Nasdaq 15,100.17 -522.54 -3.34%
GlobalDow 4,212.03 -4.91 -0.12%
Gold 1,810.30 -4.30 -0.24%
Oil 77.20 0.21 0.27%
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