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Higher for the week .

Nasdaq’s Market Intelligence Desk (MID) is designed to provide critical touch-points for timely trading analysis and market information.

Higher for the week

Friday, September 14, 2018, 10:97 AM, EST
  • NASDAQ Composite+0.29%Dow+0.07%S&P 500+0.07%Russell 2000+0.45%
  • NASDAQ Advancers:1384Decliners:789
  • Today’s Volume (vs. yesterday)-22.3%

The markets opened flat this morning but are drifting higher, and if the SPX manages to close in the green it will be the only major index closing consistently higher through the week. Large cap stocks outperformed through most of the while small and midcaps fell behind, but that flips today with R2K leading the other majors. Hurricane Florence dominates the headlines but it’s still too early for damage assessments. The sectors are mixed with REITs and Utilities down over 1% each while Financials lead to the upside with a 0.5% advance. Market volumes are recovering from the summer lull and if today’s volume hits average, the week’s volume will be the highest in at least a month or more. The dollar index (+0.2%) is higher for the first time in two days, gold falls 0.1%, and treasuries are weaker with yield on the 10-yr at 2.9995%.

  • This week we received soft producer and consumer prices and today comes soft August retail sales; taken together that could be view as ominous. But not so fast -- July’s retail numbers were revised considerably higher and that explains August. Topline retail sales gains just 0.1%, down from an upwardly revised +0.7% in July and below the +0.4% consensus. Ex-autos and energy the measure rose 0.2% after July’s revised +0.9%, and the control group advanced +0.1% after July’s revised +0.8%. Apparel cost fell the most since the late 1940s and that impacted both today’s retail sales and yesterday’s CPI, but the price weakness was likely due to end of season sales. Overall nine of the thirteen retail categories experienced increases in August. Separately Industrial Production and Capacity Utilization numbers held steady in August, no sign of a slowdown there.
  • Conflicting signals continue clouding the outlook on trade with China. The markets breathed a sigh of relief earlier in the week on word that administration officials invited China back to the bargaining table, then Trump undercut that by saying ‘they are under pressure to make a deal with us…our markets are surging, theirs are collapsing.” Both Bloomberg and the Washington Post write that many analysts see it differently. “To the extent that Trump is looking at that [the markets] and thinking he has China by the neck, he’s wrong. Trump has less leverage than he thinks.” said economist Andrew Polk, partner at Beijing-based advisory firm Trivium. Eswar Prasad, former China division chief at the IMF says China is “certainly open to overtures because they would like to bring this trade dispute to some kind of resolution. But I don’t think they are going to give anything to Mnuchin.” It seems China would hold off on any potential agreements until after the November elections when Trump’s hand might be significantly weakened.

Technical Take:

Consumer confidence data remains elevated and future expectations increased to a 14-year high. This is not unexpected given the strong stock market and accelerating wage data. Expectations for a fourth rate hike in December have quickly risen to an 80% probability, according to Bloomberg. This increasingly hawkish outlook can also be seen in the 2-year Treasury yield, most sensitive to rate expectations, which last Friday broke out of a six week range following the monthly employment and payroll data. The short yield has now strung together six consecutive days of gains.

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Nasdaq's Market Intelligence Desk (MID) Team includes:

Charles Brown is Associate Vice President on The Market Intelligence Desk with over 20 years of equity capital markets experience. Charlie has extensive knowledge of equity trading on both floor and screen based marketplaces. Charlie assists with the management of The Market Intelligence Desk and works with Nasdaq listed companies providing them with insightful objective trading analysis.

Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

Brian Joyce, CMT is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Before joining Nasdaq Brian spent 16 years as an institutional trader executing equity and options orders for both the buy side and sell side. He also provided trading ideas and wrote technical analysis commentary for an institutional research offering. Brian focuses on helping Nasdaq’s Financial, Healthcare and Transportation companies, among others, understand the trading in their stock. Brian is a Chartered Market Technician (CMT).

Michael Sokoll, CFA is Associate Vice President on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information. 

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