Here is what you need to know on Wednesday, August 18:
Tuesday saw most major indices post losses in the region of 1% as the Delta wave steps up its spread and US retail sales show the spending splurge may be coming to an end. Is the party over? We doubt it, given the backdrop of coordinated money printing and pumping by global central banks, strong corporate balance sheets, strong household cash hoarding, and buy-back season about to begin now that earnings season has passed us.
There is no doubt we are entering the stabilization phase of the economic bounce, and Tuesday's retail sales figures showed us this with the number disappointing investors. However, the bigger fear is if Delta gets a hold of countries and causes further lockdowns and economic hardships. While the macro picture may be beneficial, Delta can rapidly change this as the original strain did. If that happens central banks are already at full speed on the printing press, so things could get tricky. With vaccination rates on the increase in the developed world, we hope that this does not come to pass, but the recent lockdowns in Australia, New Zealand and Japan do give some cause for concern. It should be noted though that the vaccination rates in those countries are far lower than in the US and EU. The Market Ear does show hospitalizations growing worryingly in the US.
Source: themarketear.com and Topol
European markets are mixed: FTSE flat, EuroStoxx +0.1% and Dax -0.1%.
US futures also mixed: Dow -0.2%, S&P -0.1% and Nasdaq +0.1%.
SPY stock news
Fed minutes will be released later at 1400EST/1900GMT, so markets are in waiting mode.
UK CPI 2% versus 2.3% estimate.
NZ back in lockdown as Delta cases increase.
Lowe's (LOW) up 5% premarket after strong earnings and guidance.
Weibo (WB) up 5% premarket on strong results.
Viacom CBS (VIAC) upgraded at Wells Fargo.
TJX Companies (TJX) up 2% on strong earnings.
Robinhood (HOOD) earnings after the close today.
Alcon (ALC) up 10% premarket on strong earnings and guidance.
Moderna (MRNA), Pfizer (PFE), JNJ, BioNTech (BNTX): President Biden is to unveil covid booster program on Wednesday according to the WSJ.
Xpeng (XPEV) says will increase production at Zhaoqing site from 100K to 200K cars per year.
Palantir (PLTR) bought $50 million in gold bars, according to the latest earnings statement-CNBC.
Wendys (WEN): Oppenheimer upgrades.
Upgrades, downgrades, premarket movers
SPY stock forecast
We identified $441.31 yesterday and the market bottomed out just below that level. There is pretty decent volume support until $436. If $436 breaks then it is a waiting game, the trendline will come into play at $430 but we are not too happy with this support level and prefer $423.
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