What Has the Fed Spooked?

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Wednesday, July 10. The Bottom Line segment of today’s podcast starts at (2:05) for listeners who want to skip ahead. Be sure to check out the new ‘Stocks on the Contrarian Radar’ section at the bottom of this page and starting at (4:31) in the podcast recording.

State of Play

Stocks did little yesterday as Fed Chair Jerome Powell again put forward the case for rate cuts. As we eye our board of indicators for signs of direction at 0635, it looks like there may be some risk appetite developing:

• Stock index futures are advancing, led by small caps. The Russell 2000 is up 0.4% with the Nasdaq up 0.3% and S&P 500 right behind that;

• Cryptos continue to recover, with Bitcoin up 1.5% to trade around $58,600;

• Commodities aren’t doing anything. WTI crude oil is unchanged at $81.50/barrel. Copper is unchanged;

• Bonds are flat. The 2-year yields 4.62% with the 10-year yielding 4.28%.