Earnings, Existing Home Sales

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Thursday, March 20. Today’s Stocks On The Contrarian Radar©️ segment features PII 0.00%↑ and starts at the bottom of this page.

State of Play

Stocks rallied yesterday after the Fed kept rates unchanged as expected while signaling it would cut twice this year. The language in the policy statement was revised in terms that have to be considered dovish.

As we eye our board of indicators for signs of direction at 0710, things are mixed:

• Stock index futures are pointing to a lower open. The Nasdaq is down 0.7%. S&P 500 futures down 0.5%;

• Bonds are continuing to gain ground thanks no doubt to the Fed. The 10-year is down 5 basis points to 4.21% (yields move inversely to prices);

• Cryptos are showing a few signs of life, its Bitcoin up 1.7% to trade north of $85,000;

• Commodities aren’t doing anything. WTI crude oil is unchanged trading at $67/barrel. Copper futures unchanged at record highs;

Today’s Known Events

We start with earnings:

• Pinduoduo (PDD 0.00%↑), the Chinese online retailer, just reported mixed results and the stock is dropping in the pre-market;

• Shoe Carnival (SCVL 0.00%↑) earlier reported mixed results that appear to have spoked the market as that stock is getting beaten up, down 16% in the pre-market;

• Darden Restaurants also appears to have disappointed investors and is down in the pre-market;

• Designer Brands (DBI 0.00%↑), the former Discount Shoe Warehouse, also reports before the open at 0930;;

• After the close at 1600 we’ll get the biggest names to report this week: Micron Technology (MU 0.00%↑), Nike (NKE 0.00%↑), and FedEx (FDX 0.00%↑)

Existing home sales are out at 1000 ET. Economists who were surveyed expect, on average, 3.95 million transactions, less than the 4.08 million recorded last month. We’ve spoken of the importance of the housing market but 3.95 million existing home sales still sounds like a lot even if it is well below last year’s figure for February (4.38 million, if you must know).

It’s Thursday so we’ll get initial jobless claims at 0830 ET. The expectation here is for 224k new claims, a bit more than the 220k seen last week but below the four-week average of 226k.

Jerome Powell adds juice to the punch bowl by author via OpenArt.ai

The Bottom Line