Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Monday, April 29. The Bottom Line segment of today’s podcast starts at (2:43) for listeners who want to skip ahead. Be sure to check out the brand new ‘One Year Ago Today’ segment at the bottom of this page.
State of Play
Stocks rallied on Friday after the PCE Deflator came in as forecast. As we look at our board of indicators at 0635, there are no clear signs of direction just yet ahead of a big week of earnings and the Fed:
Stock index futures are basically flat, with no major US index moving more than 0.2% from the break-even point;
Commodities aren’t doing much either. WTI crude oil is unchanged at $83.50/barrel. Copper is up 0.8%;
Bonds are seeing a few bids, with the 2-year yield down 3 basis points to 4.98% whilst the 10-year is down 4bps to 4.63% (yields move inversely to prices);
Cryptos aren’t doing anything. Bitcoin is down 1.5% to trade around $62,500.
Today’s Known Events
It’s all about earnings. Domino’s Pizza (DPZ 0.00%↑) just beat earnings expectations while matching revenue estimates. The stock is moving higher in the pre-market, up 5% at the time of this writing.
SoFi (SOFI 0.00%↑) and onsemi (ON 0.00%↑) also report before the open at 0930.
After the close we’ll hear from Paramount Global (PARA 0.00%↑) and NXP Semiconductors (NXPI 0.00%↑), among others.
The Bottom Line©️
Earnings are the story of the day and likely of the week. At least until we get to non-farm payrolls on Friday. The Fed does meet on Wednesday but there is little suspense about what it will do with interest rates (nothing).
Tech stocks rallied to close out last week, so it looks like we still have risk appetite out there. That can always change very quickly, but as we said last week it looks like any pullback will ultimately lead to more buying. The bull market lives…
One Year Ago Today…
Opportunities in bonds and tech stocks were discussed (Daily Contrarian, April 28, 2023).
…and how it played out
It would have been a good time to buy tech, judging by the Nasdaq 100 (QQQ 0.00%↑), which has gained some 30% over the last year, as the chart below illustrates. Bonds of course are a different story…
Housekeeping
Obviously this is not investment advice (duh). Do your own research, make your own decisions.
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Another Massive Week for Earnings. Plus Fed, NFPs…