Microsoft, Netflix, United Health earnings and Tesla corporate news provided investors with some positive and actionable trading themes last week that ultimately delivered some lift to an otherwise trendless US equity landscape. Technically, the market outlook remains “uptrend under pressure” despite the fact that the S&P 500 gained 0.38% last week while the Nasdaq Composite registered a weekly gain of 0.79%.
The EIA Petroleum Status Report for the week ending October 14th, reflected a market moving draw of 5.2 m barrels. Distillates also slipped again by 1.2 M barrels. The Fed’s Beige Book confirmed for investors that the current rate of economic expansion remains both modest and soft. There was no mention of wage pressure despite characterizing current labor conditions as “tight.” Weekly Jobless Claims came in at 260k - more or less in line with 250k. Existing Home Sales - level - SAAR were a bright spot last week coming in at 5.470M. Year-over-year, 0.6%. Finally, the Leading indicators component of the economic calendar for September came in at 0.2%; once again hitting consensus.
This week’s economic calendar, outlined below, is likely to play second fiddle to the earnings calendar. That said it will provide the template for any further conjecture on the Fed’s intention with monetary policy through year-end. There are a few highlights. Things get rolling with this morning’s release of the Chicago Fed National Activity Index. The street is expecting below trend growth in the range of -0.55 level. The three-month average is -0.07. The PMI Manufacturing Index Flash for October Is expected to register at 51.2. Tuesday we receive the FHFA House Price Index. The street expects a monthly tick higher of 0.5%, matching last month. On a year-over-year basis, it is expected to reflect a gain of 5.8%. The Conference Board’s Consumer Confidence reading is supposed to come in at 101 versus last month’s 104.1. New home Sales - level - SAAR on Wednesday are expected to reflect a gain of 601k. Durable Goods for September are expected to be nearly flat at 0.2%. On Friday we receive GDP ( 2.5% consensus) and the Employment Cost Index ( 0.6% consensus).