Flash PMIs, Tariffs Off

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Monday, March 24.

State of Play

Stocks eked out a winning week on Friday, the first time that’s happened in a month. There were some encouraging soundbytes on tariffs over the weekend, which appears to have affected investors’ moods. As we eye our board of indicators for signs of direction at 0650, it looks like risk-on:

• Stock index futures are pointing to gains. Tech is leading things out, with the Nasdaq up 1.4%. S&P 500 futures are 1.1% to the good;

• Commodities are gaining ground. Copper is up 1% to climb to fresh all-time highs. Seems that has gone kind of unnoticed? WTI crude oil is up 0.7% to trade close to $69/barrel, its high point of the last couple of weeks;

• Cryptos, too, are rising. Bitcoin up 4% to trade around $87,600;

• Bonds are seeing a bit of selling, which is consistent with the risk-on theme. The 10-year yields is up 4 basis points to 4.29% (yields move inversely to prices).

Today’s Known Events

Purchasing Manager Indexes from S&P Global are out at 0945 ET. Seeing how these are the first look at these they’re referred to as ‘Flash PMIs’ and more important than the non-flash reading, which just confirms what’s in this one.

There are two of these: one for manufacturing and one for services. The numbers we’re anticipating:

• 51.9 for manufacturing, a decline from the 52.7 recorded last month;

• 51.2 for services, effectively in line with the 51.0 last month.

Worth pointing out that the 50 line separates expansion from contraction. Also worth pointing out that this is a survey, however seeing how it is a survey of business owners versus one of consumers, it is likely far more telling.

We do have some earnings today, but those aren’t until after the close at 1600. KB Home (KBH 0.00%↑) and Oklo (OKLO 0.00%↑) are the biggest names there.

The Bottom Line