Wake Up Wall Street (SPY): Taper talk makes markets tumble, but is it a tantrum yet?
Here is what you need to know on Thursday, August 19:
The Fed did what it probably needed to do on Wednesday with the release of the much anticipated minutes. Markets are stretched and money is cheap, so the Fed had to try and cool things slightly. It does not want another bubble going bang akin to 2000 or 2008. The prescribed medicine therefore was to talk the taper, and markets indeed took the bait and fell. Nothing too serious, but given what we have become used to, two days of losses comes as something of a shock. Now is this the time to buy the dip or the beginning of the end? The US 10-year would lead us to believe that this is merely a dip with the yield unchanged from yesterday, but European markets are reacting poorly with the DAX shedding 2%, the biggest fall we have witnessed in a major index in months.
In more news, the retail sector continues to impress with results out this morning from Macy's (M) and Kohls (KSS). This despite last weeks disappointing retail sales number. Go figure!
The dollar likes the taper and finally caught the 1.16 handle it has been seeking for some time – 1.1695 versus the euro. Oil is still weak at $63 now on the back of Delta, the dollar and demand. Bitcoin has held up well but is lower at $44,400, and Gold is $1,784.
European markets are lower: Dax -2%, FTSE -1.3% and Eurostoxx -1.4%.
US futures are also lower: Dow -1%, S&P -0.8% and Nasdaq -0.6%.
SPY stock news
Australia, New Zealand, and Japan extend delta-driven lockdown.
Fed minutes discuss ending stimulus or taper.
Goldman Sachs cuts growth forecast to 5.5% from 9% so nearly halved! “The impact of the Delta variant on growth and inflation is proving to be somewhat larger than we expected.”
Macy's (M) EPS of $1.29 versus the forecast of $0.14. Up 5% premarket.
Kohls (KSS) is also up 3% on the back of strong results.
Robinhood (HOOD) down 10% premarket on Q3 outlook. see more.
Cisco (CSCO) EPS and revenue ahead of estimates but guidance behind estimates. Shares down 1%.
Nvidia (NVDA) EPS beats as does revenue, stock up 1% premarket.
Dlocal (DLO) up 21% premarket as sales numbers are strong.
Bath and Bodyworks (BBWI) up 4% on strong earnings.
Petco (WOOF): One of our favourite tickers is down 1% premarket though EPS and revenue beat estimates. Woof!
Oatly (OTLY): RBC upgrades
Weibo (WB): Credit Suisse upgrades.
Upgrades, downgrades and premarket
Source: Benzinga Pro
Economic releases
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Author
Ivan Brian
FXStreet
Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.
