Traders Market Weekly: Yield Inversion Therapy Kill Growth To Kill Inflation

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    OHHHH THE HUMANITY – Crazy night at OSCARS — was this real or even a staged publicity stunt 😉


    OIL falls over 6% to $106 barrel … time for the OIL BULLS to buy on the dip – lol 🙂
    My better 1/2 even saw prices “FALL” to $3.99 in SW VIRGINIA (and believe DEMAND is down)

    WALL STREET is slightly down (less 1%) at this point. Not sure what is ahead
    and all we can do is hope/pray for best for our world … esp. hope for PEACE in near future.


    Dow 34,955.89 94.65 0.27%
    S&P 500 4,575.52 32.46 0.71%
    Nasdaq 14,354.90 185.60 1.31%
    GlobalDow 4,098.46 -6.88 -0.17%
    Gold 1,921.20 -33.00 -1.69%
    Oil 103.49 -10.41 -9.14%


    Overnight Summary — World markets take flight

    The global equity markets are mostly higher. S&P Futures are trading about 20 points better to around the 4588 area. The market was stagnant in a narrow range through most of the Asian session, but began breaking out to the upside toward the end. The European open enabled follow through, taking the spoos to the high of 4592.75. The low was established early at 4565.25.

    In Asia, China slipped 0.3% while Japan rose over 1%. The Shanghai was among the few markets trading lower. The negative sentiment over recent coronavirus lockdowns overshadowed speculation that the PBOC may lower the reserve requirement ratio. In Japan, the Nikkei took back the prior day’s loss and then some. Export stocks were met with enthusiasm after the recent weakness in the yen. Toyota and Subaru were the leading automotive names with gains of around 2.5%.

    In Europe, the major bourses are following the rising tide. Peace talks between Russia and Ukraine resume in Turkey today and may be lifting spirits. Financials are outperforming the benchmarks with lenders such as BNP Paribas, Societe Generale and Credit Agricole up 2-3%. Auto OEMs are leading as well with Renault, Volkswagen and BMW up about 2-3%.


    Market Updates

    S&P Futures vs Fair Value: +20.0
    10 yr Note: 2.510%
    USD/JPY: 123.66 -0.26
    EUR/USD: 1.1022 +0.0034
    Europe: FTSE: +0.9% DAX: +1.8% CAC: +2.1%
    Asia: Hang Seng: +1.1% Shanghai: -0.3% Nikkei: +1.1%
    Gold (1911.00 -28.80) Silver (24.75 -0.45) Crude (105.67 -0.29)


    Japan says to impose ban on Russia-bound exports of precious metals starting 5 April
    The ban will cover mostly gold

    via Japanese ministry of finance, as part of the latest sanctions against Russia over the war in Ukraine.



    6:30 a.m. ET: McCormick (MKC) is expected to report adjusted earnings of $0.62 per share on revenue of $1.47 billion


    Chewy (CHWY) is expected to report an adjusted loss of $0.05 per share on revenue of $2.42 billion

    RH (RH) is expected to report adjusted earnings of $5.60 per share on revenue of $933 million

    Micron Technology (MU) is expected to report adjusted earnings of $1.98 per share on revenue of $7.56 billion

    Lululemon (LULU) is expected to report adjusted earnings of $3.27 per share on revenue of $2.14 billion


    Ukraine says suggested new security guarantee in today’s talks
    If security guarantee system works, Ukraine will agree to neutral status
    Would include not having foreign military bases
    A referendum in Ukraine would be needed on terms of agreement with Russia
    Israel, Poland, Canada, Turkey could be among Ukraine security guarantors under new system


    Dow 35,294.19 338.30 0.97%
    S&P 500 4,631.60 56.08 1.23%
    Nasdaq 14,619.64 264.73 1.84%
    GlobalDow 4,152.31 55.35 1.35%
    Gold 1,918.50 -21.30 -1.10%
    Oil 105.03 -0.93 -0.88%


    The global equity markets are mixed heading into Wednesdays open. S&P Futures are down about 13 points to around the 4612 area. The market has struggled to find direction on a relatively quiet night. The range saw a high of 4627.50 and a low of 4604.75.

    In Asia, China rose 2% while Japan slid nearly 1%. The Shanghai perked up on continued speculation of stimulus on the horizon. The property sector led the gains in both the Chinese benchmark and Hong Kong’s Hang Seng. In Japan, weaker than expected Retail Sales for February disappointed investors. Shares of Nintendo dropped nearly 6% after the company announced it will delay the launch of its latest Legends of Zelda game.

    In Europe, the major bourses are mostly lower. Sentiment turned sour following skeptical remarks from Ukraine’s Zelenskyy about Russia’s intentions of peace. Financials are giving back gains from Tuesday with banks such as Credit Agricole, Societe Generale and BNP Paribas down 2-3%.


    S&P Futures vs Fair Value: -12.0
    10 yr Note: 2.394%
    USD/JPY: 121.68 -1.21
    EUR/USD: 1.1156 +0.0068
    Europe: FTSE: +0.1% DAX: -1.2% CAC: -1.0%
    Asia: Hang Seng: +1.4% Shanghai: +2.0% Nikkei: -0.8%
    Gold (1919.40 +7.20) Silver (24.99 +0.25) Crude (107.06 +2.82)


    S&P 500 futures 0.1% below fair value; Nasdaq 100 futures 0.3% below fair value; DJIA futures 0.3% below fair value

    Key factors driving the futures market:

    Breather after S&P 500 rallied 11.0% since March 14
    Tempered hopes for a ceasefire after Russia refuted a breakthrough in peace talks
    Senator Joe Manchin (D-WV) says he will not support President Biden’s proposal for 20% minimum tax on billionaires that was part of his budget, according to The Hill
    Germany might have to ration natural gas amid Russian dispute, according to CNBC
    China critical of western sanctions against Russia for Ukraine war, according to Reuters
    Micron (MU), lululemon athletica (LULU), and BioNTech (BNTX) jump on pleasing earnings news
    Chewy (CHWY) and Five Below (FIVE) provide disappointing guidance


    10-yr note yield +1 bps to 2.41%; 2-yr note yield UNCH at 2.35% after a brief inversion yesterday



    Goldman upgraded HF Sinclair (DINO) to Neutral from Sell with a price target of $43, up from $32. The firm notes the key driver of the upgrade is the incorporation of the Sinclair acquisition, which is accretive. The firm says HF’s increased Rockies exposure provides a quality of earnings and stronger diversification.

    Jefferies upgraded Host Hotels (HST) to Buy from Hold with a price target of $25, up from $20. It is evident in the pace of the broader recovery that “market exposures matter” and portfolio make-up makes the difference. The firm believes the asset trades and positioning of Host shares should outperform those of Park Hotels & Resorts (PK), which the firm has simultaneously downgraded to Hold from Buy. The earnings growth trajectory for Park is steeper than at Host, which is largely driven by the fundamental portfolio differences that the firm believes favor Host.



    Loop Capital downgraded Wayfair (W) to Sell from Hold with a price target of $90, down from $95 as part of a broader sector research note discussion “big-ticket DTC companies”. Given the outlook for rising interest rates, the end of COVID stimulus, and related demand pull-forward, the firm believes the organic sales trend is slowing for DTC companies as consumers normalize store visits. The firm adds that inflation in digital advertising has also worsened the company’s macro environment.

    JP Morgan downgraded Procter & Gamble (PG) to Neutral from Overweight with a price target of $165, down from $181. The firm notes the stock’s current widened valuation premium to the group already reflects its “superiority. Investors expect to see Procter & Gamble “beat and raise,” but this is now harder under the current cost and currency headwinds, says the firm. As such, the firm believes it is prudent to take a pause and wait until consensus incorporates a more realistic outlook.

    Morgan Stanley downgraded Kimco Realty (KIM) to Equal Weight from Overweight with a price target of $26.50, up from $26. The firm cites valuation for the downgrade with the shares up 34% year-over-year. The firm notes Weingarten Realty (WRI) acquisition and Albertson’s monetization are now better reflected in the stock price.

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