A Few Earnings, Countdown to Fed/CPI

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Tuesday, June 11. The Bottom Line segment of today’s podcast starts at (3:27) for listeners who want to skip ahead.

State of Play

Stocks eked out a small gain yesterday in what was as anticipated a quiet session. As we look at our board of indicators at 0620, risk-off appears to be in order:

• Stock index futures are pointing to a lower open with small caps leading the drop. The Russell 2000 is down 0.8%. S&P 500 (SPY 0.00%↑) and Nasdaq 100 (QQQ 0.00%↑) futures are down ~0.3% each;

• Commodities are dropping with copper down 2%. Other industrial commodities (zinc, lead, aluminum) are seeing similar declines. Reports of a drop in oil imports from China may be behind this. Speaking of oil, WTI crude is down 0.2% to trade around $77.50/barrel. Silver is down 2%. Natural gas is an outlier, up 5%;

• Bonds are seeing a few bids with the 2-year yield down 3 basis points to 4.85% and the 10-year yield down 3bps to 4.44% (yields move inversely to prices);

• Cryptos are down with Bitcoin off 3% to trade around $67,100.

Today’s Known Events

The National Federation of Independent Business, or NFIB, just reported its Small Business Optimism Index for May. The number came in at 90.5, which was higher than the 89.8 expected by a survey of economists. It’s also the third month in a row the number has printed higher after dropping to a multi-year low in March. Make of that what you will. It’s not a major release but then today is a quiet day.

In fact, all we have are some earnings but those aren’t until after the close: Oracle (ORCL 0.00%↑), Autodesk (ADSK 0.00%↑), Casey’s General Stores (CASY 0.00%↑), and PetMed Express (PETS 0.00%↑) are the most notable names there. So yeah, slow day.

The Bottom Line©️

Boring, boring. Don’t worry things will get interesting tomorrow with the CPI out before the open and Fed meeting in the afternoon.

For now while it’s quiet make sure you listen to the latest guest episode with Leo Schmidt. That is out for you and you only at this time. Everybody else has to wait and when they do get it they’ll have to deal with annoying ads and announcements but you do NOT as the entire thing is ad and interruption-free!