Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets in the day ahead. Today is Thursday, Oct. 19. The Bottom Line segment of today’s podcast starts at (5:29) for listeners who want to skip ahead.
State of Play
Stocks sold off yesterday, worse than bonds this time. Small caps saw the worst of it, with the Russell 2000 dropping by 2%. After the close Tesla (TSLA 0.00%↑) reported disappointing earnings whilst Netflix (NFLX 0.00%↑) supplied positive news. Overnight things took a turn for the worse again in the bond market, and that is where the action is as of 0615:
Bond yields are moving higher with the 10-year up 6 basis points to 4.96% while the 2-year is up 3bps to 5.24%. The 30-year crossed 5% and is up 4bps to 5.04%. These are right around multi-decade highs;
Stocks aren’t moving much yet. Small caps are continuing to sell off, with the Russell down 0.3%. S&P 500 (SPY 0.00%↑) and Nasdaq (QQQ 0.00%↑) futures are unchanged;
Commodities are retreating a bit, with WTI crude oil down 1.7% to trade below $86/barrel. Copper is up 0.3%.
Known Events
A couple of Fed speakers to tell you about today, the main one of course being Jerome Powell who delivers a keynote speech at the Economic Club of New York at 1200. The speech will be broadcast live on the Fed’s YouTube channel.
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