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02/06/2025 ES Trade Plan Worksheet

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Feb 062025
 

Alphabet (GOOG, GOOGL) ended Wednesday down 7%, partly due to heavy AI spending that won’t see a payoff in the near future.  Nvidia (NVDA) is a beneficiary of that spending and rose 5%, helping the indexes into positive territory.  The Dow Jones closed up 0.7%, the S&P 500 up 0.4%, while the Nasdaq eked 0.2%.

Amazon (AMZN) will report after the bell today.  Focus will be on their cloud and AI revenues.  Alphabet and Apple (AAPL) are getting caught up in a tariff tit-for-tat between the US and China.  China has launched antitrust probes into the two companies.

Meanwhile, the 10-year Treasury yield fell 9 basis points to hit 4.42%, the lowest level this year.

Trump is keeping markets on alert and confused with new executive orders and potential new policy statements.  And some suggestions like taking over the Gaza strip to build the “Riviera of the Middle East” and dispersing Palestinians to other countries, is getting consideration from world leaders like Israel’s Netanyahu.

Senate Democrats are holding the Senate floor for a planned 30 hours to protest the nomination of Russell Vought for head the Office of Management and Budget.  Vought thinks laws limiting impoundment are unconstitutional. Current impoundment laws were passed in the early 70s in response to Richard Nixon’s abuse of congressionally allocated money.  The laws require presidents to ask Congress for permission to use congressionally allocated funds for different purposes.  Trump wants to use US funds as he sees fit, and Vought is onboard to help him.

Many in Washington think the constitutional crisis over impoundment is already here as Musk and DOGE boast about breaking government contracts that Musk calls “illegal payments.”  Musk has thrusted the impoundment legal debate into the everyday lives of US citizens.

Separately, Trump’s (likely illegal) offer to pay federal employees through September if they resign has attracted over 40,000 signups (2% of the workforce) into the final 24 hours that expires at end-of-day today.  On average, 62,000 federal employees retire each year and 298,000 are eligible for retirement within 2 years, so it’s likely Trump’s buyout offer will cost more than it saves.  The White House estimated 5% to 10% of federal employees would take the offer.

Corporate earnings premarket include ConocoPhillips (COP), Yum! Brands (YUM), APTV, MT, AZN, AVB, BCE, BDX, OWL, BMY, CMS, DECK, LLY, ENTG, EFX, RACE, HLT, HON, ING, ICE, IQV, ITT, K, KVUE, LH, LIN, MTSI, MTD, NVT, PM, RL, RBLX, SNA, SOLV, SMFG, TAK, TPR, TU, ALL, HSY, TRI, TW, WMG, XEL, YUMC, and ZBH.

Earnings after the bell include Amazon (AMZN), FedEx (FDX), AFRM, APD, ATR, BILL, CPT, NET, EHC, EXPE, FTNT, MCHP, MPWR, NBIX, NWS, ONTO, PCTY, PINS, REG, RGA, SKX, SSNC, TTWO, and VRSN.

The economic calendar includes Challenger Job Cuts @ 7:30am ET and Unemployment Claims, Nonfarm Productivity, and Unit Labor Costs @ 8:30am ET.  Fed speakers include Waller @ 2:30pm ET and Daly @ 3:30pm ET.

Volatility remains steady and elevated.

No whale bias as overnight large trader volume is both light and mixed.

 

 

 Posted by at 4:08 am

02/05/2025 ES Trade Plan Worksheet

 Pre-market Commentary  Comments Off on 02/05/2025 ES Trade Plan Worksheet
Feb 052025
 

Stocks closed higher on Tuesday, powered by Big Tech.  The Nasdaq jumped 1.4%, the S&P 500 up 0.7%, and the Down Jones climbed 0.3%.  China’s quick retaliation on Trump’s 10% tariffs is seen by some analysts as restraint from China, keeping hopes of a compromise alive, like the Mexico and Canada 1 month postponement deals.

The US Postal Service has temporarily suspended inbound packages from China and Hong Kong posts, delaying or blocking retail packages from retailers selling Chinese imported goods like Amazon, AliExpress, Temu, and Shein.  The package freeze highlights the complications of collecting Trump’s 10% fee on Chinese imports.  Trump’s Chinese tariff revokes a “de minimis” rule that allowed small packages under $800 to enter UD duty-free.

Shares of Alibaba (BABA) and JD.com are down in Hong Kong trading.  A phone call between Trump and China’s President Xi Jinping could happen today.

Alphabet (GOOG, GOOGL) shares plunged about 7% after earnings.  The company’s cloud revenue was disappointing and spending was higher than expectations.  Alphabet’s earnings are weighing on Nasdaq futures this morning.

Advanced Micro Devices (AMD) stock jumped in after-hours but then turned down 9%.  AMD beat revenue estimates and raised their revenue forecasts.  The company sees “growing demand for high-performance and adaptive computing,” however their data center business growth forecast disappointed investors looking for signs of momentum in AI chips.  AMD is battling to take AI market share from Nvidia (NVDA) in a time when AI powered PC sales are slowing.

Corporate earnings premarket include Alibaba Group (BABA), Walt Disney (DIS), Uber Technologies (UBER), ARCC, ARES, ATO, BBD, SAN, TECH, BSX, BG, CDW, COR, CCI, DAY, EMR, EQNR, EVR, FOXA, GSK, IEX, ITW, JCI, LINE, ODFL, IX, PAG, PFGC, SWK, TROW, TTE, and XPO.

Earnings after the bell include Arm (ARM), Ford Motor (F), Qualcomm (QCOM), AFL, ALGN, AVB, CTSH, CPAY, CTVA, CCK, EOH, GL, HOLX, MKL, MCK, MET, MSTR, MAA, MOH, NWSA, OHI, ORLY, PTC, RRX, SWKS, STE, SU, SYM, ALL, and UDR.

The economic calendar includes ADP @ 8:15am ET, Trade Balance @ 8:30am ET, S&P Global Final Services PMI @ 9:45am ET, and ISM Services PMI @ 10:00am ET.  Fed speakers include Barkin @ 7:30am ET and 9:00am ET, Goolsbee @ 2:30pm ET, and Bowman @ 3:00pm ET.

Volatility remains elevated and steady.  The ES 5-day average daily range is 86.50 points.

Whale bias is bearish into the 8:15am ET ADP report on lighter than recent overnight large trader volume.

 

 Posted by at 6:39 am