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Jul 20, 2015
via Morning Bid with David Gaffen

Little Blue

IBM, long-time stalwart of the Dow industrials, reports quarterly results after the close, the first of several major technology bellwethers to release its earnings figures. The stock has been a laggard compared with the benchmark S&P 500 over the last year or so, with the S&P’s greater-than-10-percent return easily dwarfing the losses from IBM in that time.

The results should help clarify whether the company is starting to see some traction in the cloud area that has been its bugaboo; it has been critiqued for having invested in and moved on that area later than the rest of the market, part of what has hurt the stock in the last couple of years.

Jul 16, 2015
via Morning Bid with David Gaffen

Google, Interrupted

The next bellwether on the earnings docket is Google, with the hope that it should exceed expectations, but the stock has been in a steadily declining pattern of lower highs and lower lows since it hit its peak in early 2014.

Such a pattern could be on the verge of being interrupted, though, and the latest activity in the options market suggests some people think there’s enough going on that’s bullish that could propel shares through the $600 mark. This won’t necessarily be easy, though.

Jul 16, 2015
via Morning Bid with David Gaffen

Google, Interrupted

The next bellwether on the earnings docket is Google, with the hope that it should exceed expectations, but the stock has been in a steadily declining pattern of lower highs and lower lows since it hit its peak in early 2014.

Such a pattern could be on the verge of being interrupted, though, and the latest activity in the options market suggests some people think there’s enough going on that’s bullish that could propel shares through the $600 mark. This won’t necessarily be easy, though.

Jul 15, 2015
via Morning Bid with David Gaffen

Binge-watching earnings and the Fed

The Federal Reserve is the early concern on the part of investors – Janet Yellen’s testimony is out in the morning when she appears before the combative House of Representatives, though her speech on Friday highlighting her concerns about ongoing slack in the labor market and the possibility that international issues may undermine the Fed’s plans fed the bearish case when it comes to rate increases.

And while many had expected September to be the moment for rate hikes, the consensus is shifting, however slowly, toward December. The testimony should be pretty straightforward, and we’re already aware of the expectations for the trajectory of monetary policy. So it’ll be mostly notable for fireworks, should they occur, and more than likely they will, though Yellen is getting good at brushing off the disrespect accorded her by the House.

Jul 15, 2015
via Morning Bid with David Gaffen

Binge-watching earnings and the Fed

The Federal Reserve is the early concern on the part of investors – Janet Yellen’s testimony is out in the morning when she appears before the combative House of Representatives, though her speech on Friday highlighting her concerns about ongoing slack in the labor market and the possibility that international issues may undermine the Fed’s plans fed the bearish case when it comes to rate increases.

And while many had expected September to be the moment for rate hikes, the consensus is shifting, however slowly, toward December. The testimony should be pretty straightforward, and we’re already aware of the expectations for the trajectory of monetary policy. So it’ll be mostly notable for fireworks, should they occur, and more than likely they will, though Yellen is getting good at brushing off the disrespect accorded her by the House.

Jul 14, 2015
via Morning Bid with David Gaffen

Kick the Can

If history repeats itself, first as tragedy, next as farce, the third time is probably “Greece.” The austerity measures to be implemented and the staggering bailout sum together mark another exhibit in the long history of evidence supporting the line about insanity being the thing someone does over and over while expecting a different result. In its most ruthless terms, though, the markets liked it on Monday, the stock market was higher, the Treasury market sold off, and we’re in a kick-the-can scenario that David Kotok of Cumberland Advisors a few weeks ago said would be viewed well because markets like can-kicking. It’s possible it gives investment managers the hope that they’ve found the fountain of youth or something.

But never mind that now. Greece’s effect on U.S. markets was always thought to be limited, and besides, we’re being flung headlong into earnings season now, with a number of the major banks all out and firing reports ahead of some notable others in the next 36 hours – Blackrock, Yum Brands, Netflix, a load of regional banks, that sort of thing.

Jul 14, 2015
via Morning Bid with David Gaffen

Kick the Can

If history repeats itself, first as tragedy, next as farce, the third time is probably “Greece.” The austerity measures to be implemented and the staggering bailout sum together mark another exhibit in the long history of evidence supporting the line about insanity being the thing someone does over and over while expecting a different result. In its most ruthless terms, though, the markets liked it on Monday, the stock market was higher, the Treasury market sold off, and we’re in a kick-the-can scenario that David Kotok of Cumberland Advisors a few weeks ago said would be viewed well because markets like can-kicking. It’s possible it gives investment managers the hope that they’ve found the fountain of youth or something.

But never mind that now. Greece’s effect on U.S. markets was always thought to be limited, and besides, we’re being flung headlong into earnings season now, with a number of the major banks all out and firing reports ahead of some notable others in the next 36 hours – Blackrock, Yum Brands, Netflix, a load of regional banks, that sort of thing.

Jul 10, 2015
via Morning Bid with David Gaffen

What a Week!

The desire for the weekend would normally be among the motivating factors for hoping for a quiet day on Friday, particularly after the week the markets have endured – China continuing to melt down, Greece getting ready to go down the rabbit hole, the NYSE experiencing a three-hour halt as a result of a software update – if only the weekend didn’t pose its own special danger. And before that, Janet Yellen stands in the way too, so the relief won’t come for investors until that’s done.

China managed two days in a row of rallies, with the Shanghai Composite bouncing back again to the tune of a 4.5 percent gain. Again, it’s tempting to say things have been fixed now, but that seems reductive, and maybe it’s only just enough to hope things aren’t berserk there for much longer than anything else.

Jul 10, 2015
via Morning Bid with David Gaffen

What a Week!

The desire for the weekend would normally be among the motivating factors for hoping for a quiet day on Friday, particularly after the week the markets have endured – China continuing to melt down, Greece getting ready to go down the rabbit hole, the NYSE experiencing a three-hour halt as a result of a software update – if only the weekend didn’t pose its own special danger. And before that, Janet Yellen stands in the way too, so the relief won’t come for investors until that’s done.

China managed two days in a row of rallies, with the Shanghai Composite bouncing back again to the tune of a 4.5 percent gain. Again, it’s tempting to say things have been fixed now, but that seems reductive, and maybe it’s only just enough to hope things aren’t berserk there for much longer than anything else.

Jul 9, 2015
via Morning Bid with David Gaffen

Selloffs Can’t Happen When Markets Are Closed

One lesson the Chinese have figured out in the last few days, and the same goes for whatever squirrel chewed through the wires at the NYSE to cause a three-hour trading halt, is that markets can’t go down when they’re closed.

This of course does not suggest any real sense of confidence, of course, because the point of markets is to be, y’know, open, and the NYSE’s problems can be blamed on someone dumping coffee on a server somewhere while the Chinese have taken a more deliberate approach to heading off what’s already a massive selloff.

    • About David

      "David Gaffen oversees the U.S. markets team, having joined Reuters in May 2009. He spent four years at the Wall Street Journal, where he was the original writer of the web site's MarketBeat blog. He is a frequent guest on Reuters TV, and has appeared on CNN International, Fox Business, NPR, and assorted other media and is the author of the book "Never Buy Another Stock Again.""
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