/ May 08
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Thursday:
Initial Jobless Claims (232K exp.)
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Friday:
Various Fed Speakers -
Thursday:
Shopify Inc.
Anheuser-Busch Inbev SA
ConocoPhillips
McKesson Corporation
Brookfield Corporation
Monster Beverage Corporation
Cheniere Energy, Inc.
Sempra
Daily Briefing
*Admin Note: we are working to fix the portfolio display issues for Millennium Strategies in V2; meanwhile, for Millennium Strategies, please use the legacy portfolios available on the old website.
*The stock market had a mixed showing yesterday; major indices were in a holding pattern in the early going as investors waited for the FOMC policy decision at 2:00 ET and Fed Chair Powell's press conference at 2:30 ET;
*The committee voted unanimously to maintain the target range for the fed funds rate at 4.25-4.50%, which was largely expected; market participants were hoping for more clarity about the Fed's path regarding rate cuts at Fed Chair Powell's press conference, but he maintained that policy is in a good place to allow the Fed to wait for more data; Jerome Powell repeatedly emphasised the uncertainty and unpredictability stemming from the Trump administration policy;
*The most important aspect of SPY’s price action was the ability to close in the green, despite the “extended pause” telegraphed by the Fed; while the intra-day activity was somewhat volatile, the benchmark equities ETF climbed +0.42%, setting up a challenge to the S1 resistance level and the 200-DMA next; support remains at $543 (20-DMA);
*The MACD is still unusually extended, and suggesting limited upside in the near-term;
*Dark Pools Buyers have shown up during this key session, with the average index at 50% for the day, higher than yesterday’s 47%; some key magnificent 7 companies remain under selling pressure, most notably GOOG and TSLA;
*Others have seen continued accumulation activity, including META and NVDA;
*GLD has also been continuously accumulated during yesterday’s session, suggesting continued bullion demand;
*Post FOMC meeting, major equity indices had a volatile response, ultimately closing higher for the day; the Dow Jones Industrial Average rose +0.7%, the S&P 500 closed +0.4% higher than the day before, and the Nasdaq Composite registered a +0.3% gain;
*GEX remains positive for both SPY and QQQ, and would be positive on average for all sector ETFs if it were not for the very large drag coming from Energy (XLE); overall, we would say that market internals look quite bullish here, from a dark pools and options market perspective;
*Equity indices held up well considering the disappointing price action in Alphabet (GOOG, -7.5%) and Apple (AAPL, -1.1%) after a Bloomberg report that Apple may shift toward using an AI search feature, which would reduce the reach of Alphabet's Google;
*Many other stocks participated in upside moves; advancers led decliners by a 3-to-2 margin at the NYSE and by an 11-to-10 margin at the Nasdaq;
*The upside bias was driven in part by news of policy easing by the People's Bank of China, along with optimism about the trade war following news that representatives from the U.S. and China will meet to begin trade talks in Switzerland on May 8;
*There is also an announcement of an impending trade deal with a major partner (rumoured to be the UK) pushing futures higher this morning;
*Some of the optimism around trade developments were tempered, however, after President Trump said that he is not open to pulling back the 145% tariff on imports from China as part of negotiations;
*Late afternoon reports also indicated that the Trump administration is considering rescinding the AI chip export restrictions; this news sparked increased buying in the chipmaker space, leading the PHLX Semiconductor Index (SOXX) to close +1.7% higher;
*The price action in chipmakers helped boost the S&P 500 technology sector (XLK) to a 0.9% gain despite the decline in Apple; the consumer discretionary (XLY, +1.0%) and health care (XLV, +0.8%) sectors were also top performers; the communication services sector was the worst performer by a wide margin due to the fallout in Alphabet;
Sector ETFs relative-to-SPY returns for yesterday
*TLT gained +0.42% on the day, as US dollar strength was an emerging theme following the Fed’s reluctance to cut rates;