The tech giants almost exclusively extended the market winning streak to seven days in a row as index prices continued to pound on the door of overhead resistance. At the same time, oil prices plunged as China’s export declines suggest slowing economic growth in major economies of the world including the U.S.  Today investors will look for inspiration in Mortgage Applications, Inventories, Petroleum Status, Fed speakers that include Jerome Powell and busy day of earnings to keep prices volatile and challenging. Be prepared for just about anything as weakening consumer demand concerns and the current buying enthusiasm battle for control of market sentiment.

While we slept Asian markets closed mostly lower with only Australia gaining a modest 0.26%. European markets this morning have chopped between gains and losses waiting on earnings to break the log jam of caution.  U.S. futures are also rather cautious this morning currently suggesting a flat open that could change dramatically by the open depending on the reaction to all the earning and economic data ahead.

Economic Calendar

Earnings Calendar

Notable reports for Wednesday include ME, DDD, AFRM, ADNT, BIRD, AMC, ARM, APP, ASH, ATO, BYND, BIIB, BE, CEVA, CRL, CDE, CTVA, APPS, DIOD, DIS, DUOL, EVGO, AG, FICO, FSR, FLT, FNV, GNK, G, HP, HLMN, HLLY, HUBS, CART, JAZZ, K, KRNT, LITE, LYFT, MCFT, MGM, NYT, PAAS, PYCR, PFGC, PUBM, RL, REYN, RBLX, SEAS, STWD, SGOO, TTWO, TEVA, TTGT, MODG, COOK, TTEC, TWLO, UAA, SPCE, WRBY, WDB, WOW, KLG, XPEL, & ZIP..

News & Technicals’

Credit card debt in the U.S. has reached a record high of $1.08 trillion, according to a report from the Federal Reserve Bank of New York. This reflects the impact of rising inflation, which has eroded the purchasing power of consumers and forced them to use up their savings and rely more on credit cards to cover their expenses. However, credit cards are also one of the most costly forms of borrowing, as they charge high-interest rates and fees. This can create a vicious cycle of debt, as consumers struggle to pay off their balances and incur more interest and penalties. Therefore, consumers should be cautious about using credit cards and try to pay more than the minimum amount each month to reduce their debt burden.

UBS, the Swiss banking giant, is issuing a new type of bond that can be wiped out if the bank faces a financial crisis, according to CNBC. The bond is called additional tier 1 (AT1) security, and it is designed to absorb losses and protect the bank’s capital. However, the bond also carries a high risk for investors, as they can lose their entire investment if the bank fails or needs a bailout. This happened to Credit Suisse, another Swiss bank, in March when its AT1 bonds worth $17 billion were canceled as part of a rescue deal by the Swiss authorities. The bondholders were outraged by the decision, which left them with nothing. UBS did not disclose the details of its AT1 offering but said it will provide more information when the deal is completed.

Salesforce, the leading cloud-based software company, and San Francisco, the host city of its annual conference, Dreamforce, have reached an agreement that will ensure the event will stay in the city in 2024. The agreement came after Salesforce CEO Marc Benioff hinted that the conference might move to another location, due to the challenges of hosting a large-scale event amid the COVID-19 pandemic and the social issues facing the city. However, Benioff later praised the conditions of this year’s Dreamforce, which was held in a hybrid format, with both online and in-person sessions. He also thanked the city officials and the local community for their support and cooperation. Dreamforce is one of the largest and most influential tech conferences in the world, attracting tens of thousands of attendees, speakers, and exhibitors every year.

The stock market extended its winning streak to seven days on Tuesday, as the S&P 500 index rose again predominately due to the energy of the magnificent seven the. The bond yields held firm and are once again ticking higher this morning but are still well below the peak of over 5.0% in mid-October. However, oil and energy prices had a rough day with export declines out of China showing a weakening consumer demand. WTI crude oil plunged by more than 3.5% to around $77. Concerns about the slowing economic growth in major regions of the world, such as the U.S., the eurozone, and Canada, hint that job declines could be just around the corner. Today we have another big of earnings to keep traders guessing as well as Mortgage Applications, Inventory figures, Petroleum status, and a slew of Fed speakers adding in a touch of uncertainty. 

Trade Wisely,

Doug