Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets in the day ahead. Today is Thursday, Aug. 16. This briefing was updated at 0710 to reflect Walmart earnings. (The audio was not changed).
State of Play
Stocks sold off again yesterday, with the Nasdaq (QQQ 0.00%↑) dropping by 1% for the second straight day. As of 0710 this morning it looks like markets want to shake off the doldrums and move higher:
Stock index futures are pointing to small gains at the open, led by the Russell 2000 (IWM 0.00%↑) that tracks small caps, up 0.5%;
Commodities are showing signs of life as well, with copper up 1.2% and WTI crude oil up 1% to trade north of $80/barrel again;
Cryptos are dropping, with Bitcoin down 2% to trade around $28,600. That’s below the point where it’s found itself the last month;
Bonds aren’t doing much. The 2-year yield is unchanged at 4.97% with the 10-year yield up 4 basis points to 4.30% (yields move inversely to prices).
Known Events
Walmart (WMT 0.00%↑) just reported that earnings and revenues topped analyst forecasts. WMT also raised guidance for the rest of the year. The CEO reported “modest improvement” in sales of big-ticket items, a contrast what we heard from Target (TGT 0.00%↑) earnings yesterday. Walmart is moving higher in the pre-market.
Applied Materials (AMAT 0.00%↑) and Ross Stores (ROST 0.00%↑) report earnings after the close this afternoon.
It’s Thursday so we get initial jobless claims at 0830. The expectation is for 240,000 new claims, effectively in line with the 248,000 seen last week, but north of the four-week average which is ~230,000. This number has risen for three weeks in a row. It’s still quite low however.
And that’s all we got today. Pretty slow day.
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