Inflation Back on the Menu

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Wednesday, Nov. 13. The Bottom Line segment of today’s podcast starts at (4:15) followed by Stocks On The Contrarian Radar©️ at (6:39) feat HOG 0.00%↑ for listeners who want to skip ahead.

State of Play

Stocks dropped yesterday for the first time since the election. As we eye our board of indicators for signs of direction at 0630, things appear quiet:

• Cryptos appear to be stabilizing after dropping overnight. Or at least Bitcoin is, up <1% to trade around $87,800;

• Stock index futures are effectively 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 up 0.8% to trade around $68.50. Copper is unchanged;

• Bonds are unchanged. The 2-year yields 4.35%. The 10-year yield is 4.43%. So the 2/10 gap is back up to 8 basis points.

Today’s Known Events

Inflation is back on the menu. No sooner had we thought the inflation dragon was slayed, that higher prices are suddenly back in focus. Part of this is also a reaction to political events as Trump’s policies (like Kamala Harris’, it’s worth pointing out) are expected to be inflationary. The data will be released at 0830, per usual.

‘CPI back in focus’ by author via OpenArt.ai

Anyway, the numbers we’re looking for are as follows:

• Headline CPI of 0.2% month-over-month, the same as last month;

• This would raise annualized headline CPI to 2.6% from 2.4%;

• Core CPI, which excludes food and energy, is expected to print at 0.3% MoM, which would leave it at 3.3% YoY. Both of these are unchanged from last month.

One earnings of note: Cisco (CSCO 0.00%↑) reports after the close at 1600.