Yesterday a slow and grinding day of price action with a little profit-taking after a mixed bag of earnings reports and higher than expected jobless numbers.  That said, the indexes suffered little to no technical damage with the bulls fighting hard to defend against any attempt by the bears to start a selloff.  The tech sector may experience some pressure today after NFLX disappointed investors after the bell yesterday.  Infection numbers continue to set new records, but the market is unconcerned as they wait for the next round of stimulus spending.

Asian markets closed the trading week mixed but mostly higher amidst rising US-China tensions.  European markets trade mixed this morning with an ever so slight advantage to the bulls.  Here in the US, after smashing the new infection record and disappointing NFLX report, futures point to modestly bullish open ahead of earnings and economic data.

Economic Calendar

Earnings Calendar

On the Friday Earnings Calendar, we have 28 companies fessing up to their quarterly results.  Notable reports include ALLY, BLK, CFG, KSU, FR, & STT.

News and Technical’s

Indexes found a few profit-takers yesterday after a mixed bag of earnings reports and Jobless Claims numbers higher than expected.  The market was also dealing with a new record high in pandemic infections, but just one day later, that record was smashed with the number topping 77,000 yesterday.  According to reports, the next congressional stimulus bill will cost 1.3 Trillion as written with several elected officials suggesting it needs to be substantially more.  Netflix reported a miss after the bell yesterday with and expectation that subscribers will decline in the coming quarter.  Share of Netflix fell as much as 10% in extended trading, which may add some pressure today on the high flying tech sector.  This morning analysts expect a significant increase in housing starts as the 30-year mortgage fell briefly below 3% for the first time in history yesterday.  We will also get a reading on Consumer Sentiment as well as several notable earnings reports that could move the market.

Yesterday mild round of profit-taking made for a slow grinding day of price action but little to no technical damage to the index charts.  The tech sector has seen a bit of weakness this week, and it will be interesting to see if the miss from Netflix yesterday will continue that pressure today.  There has been a notable increase in the consumer defensive and consumer staples stocks in the last few days.  It would seem we are witnessing a rotation into better value dividend-paying issues as the interest in the high flying tech sector wains.  There may be some concern that some of the current market leaders will have a difficult time supporting these high prices in their upcoming earnings reports.  As we approach the weekend, consider carefully consider the risk as the pandemic infections surge and an uncertain earnings season ramps up to a fevered pitch.

Trade Wisely,

Doug