Earnings, Producer Prices

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Thursday, Nov. 14. The Bottom Line segment of today’s podcast starts at (4:18) followed by Stocks On The Contrarian Radar©️ at (6:05) feat BBWI 0.00%↑ for listeners who want to skip ahead.

State of Play

Stocks moved sideways yesterday after the CPI came in exactly as anticipated. As we eye our board of indicators for signs of direction at 0640, it looks like the ‘Trump trade’ is back on:

• Cryptos are the main story again, with Bitcoin up another 4% to move close to $91,000. It earlier peaked north of $93,000. Seems $100k is just a matter of time for BTC;

• Stock index futures are unchanged with the exception of small caps. The Russell 2000 (IWM 0.00%↑), which has been the biggest post-election winner on the equity side of things, is up 0.5%;

• Commodities are dropping, this too a continuation of the ‘Trump trade’ that has made its mark these last six trading days since the election: Copper is down almost 2% to move right to $4/pound, its lowest level since the first quarter. Gold and silver continue to drop, down 1% each. WTI crude oil at least is holding steady around $68.75/barrel;

• Bonds aren’t doing anything but the 2/10 yield curve has widened again. The 2-year yields 4.28% with the 10-year yield 4.46%.

Earnings

A busy morning of earnings is underway:

• Disney (DIS 0.00%↑) is the biggest name to report before the open. The House of Mouse beat top- and bottom-line estimates and the stock is moving higher in the pre-market, to the tune of 5% at the time of this writing;

• Apple supplier Foxconn Technologies reported strong growth numbers overnight and the stock is moving higher in Taipei trading (its US listing FXCOF is very illiquid, from the looks of it). The Taiwanese company, which also supplies Nvidia (NVDA 0.00%↑) doesn’t supply analyst estimates but did reiterate growth prospects for the quarter.

• Chinese online retailer JD.com (JD 0.00%↑) earlier beat estimates but appears to have provided some information to irk investors as the stock is down 4% at the time of this writing;

• Another name out of China, Bilibili (BILI 0.00%↑), the online games manufacturer, beat estimates but there too appears to have supplied something to disappoint investors as the stock is down 3% in the pre-market.

After the close at 1600, semiconductor manufacturer Applied Materials (AMAT 0.00%↑) is the biggest name to report.

Economic Data

Yesterday we had the Consumer Price Index. Today we get the Producer Price Index, out at 0830. This is arguably a bigger deal than the CPI under the premise that producers pass higher costs off to consumers.

The numbers that are anticipated:

• Headline PPI of 0.2% month-over-month, which is two ticks worse than last month when no change was reported;

• That would move annualized PPI up to 2.3% from 1.8%;

• Core PPI, which excludes food and energy costs, is expected to come in at 0.3% MoM, a tick worse than the 0.2% recorded last month;

• That will move annualized PPI up to 2.9% from 2.8%.

Seeing how it’s Thursday we’ll also get initial jobless claims at 0830. Economists are anticipating 224,000 new claims, up a bit from the 221,000 recorded last week and below the four-week average of 227,000.