Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Wednesday, Jan. 15.
State of Play
Stocks bounced around yesterday, rallying after producer prices came in below forecasts, but finishing largely unchanged. As we eye our board of indicators for signs of direction at 0600 ET, things are pretty quiet:
Stock index futures are pointing to modest gains, led by small caps. Worth mentioning that the Russell 2000, which tracks small caps, did put in a 1% rally yesterday. This morning the Russell is up 0.5%. S&P 500 and Nasdaq are up 0.2% each;
Industrial commodities aren’t doing much, though precious metals are continuing to rise with gold and silver up 1%+ each. WTI crude oil is unchanged, trading around $76.50/barrel. Copper is unchanged;
Cryptos aren’t doing anything either. Bitcoin is unchanged trading right around $97,000;
Bonds are also unchanged. The 10-year yields 4.78%.
Today’s Known Events
The Consumer Price Index is the main data release of the day. This follows yesterday’s encouraging Producer Price Index. The numbers anticipated by a survey of economists:
Headline CPI of 0.4% month-over-month, a slight increase over the 0.3% recorded last month;
Headline CPI of 2.9% year-over-year (2.7% last month);
Core CPI, which excludes food and energy, of 0.3% MoM (0.3%);
Core CPI of 3.3% YoY (3.3%).
(CPI scrutiny, by author via Grok AI)
There are bank earnings to tell you about as well:
Blackrock (BK 0.00%↑), not actually a bank but an asset manager that gets grouped with the banks anyway (when it comes to earnings at least), is due at 0655;
JPMorgan Chase (JPM 0.00%↑) and Wells Fargo (WFC 0.00%↑) are up at 0700. Jamie Dimon’s comments on JPM’s call are always worth paying attention to;
Goldman Sachs (GS 0.00%↑) at 0730;
Citigroup (C 0.00%↑) at 0800;
(All times eastern)
Finally, some Fed speakers to tell you about:
Richmond Fed President Tom Barkin gives the keynote at a Maryland Chamber of Commerce event at some point this morning. Barkin is not an FOMC voting member this year;
Minneapolis Fed President Neel Kashkari provides opening remarks and participates in a fireside chat at an event hosted by his office at 1200. Kashkari, like Barkin, is not an FOMC voting member this year;
Chicago Fed President Austan Goolsbee speaks at the Wisconsin Bankers Association 2025 Midwest Economist Forecast Forum at 1200. This will be broadcast live on the Chicago Fed website. Goolsbee is a full-fledged FOMC voting member this year. He’s seen as rather dovish.
The Bottom Line
The market still doesn’t seem convinced enough to put together a sustainable rally. This may be due to the impeding inauguration of Donald Trump on Monday and the uncertainty that brings. But the lower producer prices reported yesterday were a welcome sign nonetheless.
For today’s CPI it looks like economist estimates might have been equally elevated, with a 0.4% headline print expected. The monthly CPI hasn’t been that high since March. Perhaps this is due to seasonal elements. Indeed the 0.3% anticipated for the Core CPI would be the fifth straight month of this figure. That will probably be more closely watched anyway.
If the number falls short of what’s expected we should get a rally. Whether this rally fizzles out like yesterday’s is another question entirely.
Occasional Fearless Prediction: President-elect Trump, in his inaugural address on Monday, will say something to cause a rally in stocks (and probably in cryptos).
Housekeeping
Obviously this is not investment advice (duh). Do your own research, make your own decisions.
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