With protests growing violent over the weekend and many businesses closing such as WMT, TGT, & AAPL, I feel like we have entered the Twilight Zone seeing the US Futures pointing to a gap up open.  Tensions continue to rise between the US/China, a historic unemployment rate, and negative earnings growth, but the indexes charts currently suggest a bullish V-shaped bottom. 

Asian markets closed in the green across the board overnight after reporting better than expected factory activity.  European markets are mixed but mostly higher this morning, and the US Futures currently point to a bullish open ahead of earnings and economic reports.  Expect another wild and crazy week capped off by the Employment Situation report.

Economic Calendar

Earnings Calendar

On the Morning Earnings Calendar, we have just over 30 companies reporting quarterly results.  Notable reports include ERJ and ENS.

Technically Speaking

Stocks finished the week on a mixed day of trading after the President announced that Hong Kong no longer enjoys the US special trade status.  He also mentioned that Chinese companies traded in the US would come under scrutiny for there accounting practices to protect US investors.  During the same press conference, we learned that the US has withdrawn from the World Health Organization.  Hundreds of WMT, TGT, AAPL, and other stores have once again closed, but this time it’s self-inflicted due to rioting and violent protests.  According to a new survey, global CFO’s have grown more negative on the economy, giving its worst rating in history.   They see companies taking another coronavirus big hit in 2020.  Virus blamed deaths in the US now top 106,000. 

With tensions between China and the US rising, widespread protesting closing down businesses, and lingering virus impacts, US Futures seem to be ignoring the situation pointing to a modest gap up at the open.  Analysts are beginning to suggest investors are dangerously downplaying the possible impacts as the US and China once again lock horns.  Today we will get the latest readings on PMI Manufacturing, ISM Mfg Index, and construction spending as if there was not enough for traders to digest this morning.  On Friday is the Employment Situation number that may well show 20% of American workers are unemployed, which would be a post WW2 high.  Hold on tight a stay focused on price action that could be as volatile as this weekend’s protests.

Trade Wisely,

Doug