U.S. Benchmarks Rebound After Friday's Losses

January 19, 2021 10:50 AM
A slate of weak economic data Friday added pressures ahead of the long weekend
An eroding jobs picture, along with fear that the consumer is slipping, has the risk appetite on edge from elevated levels
Better-than-feared German ZEW Sentiment has helped lift the Euro and reinvigorate U.S. Dollar pressures
Stock Market Update for Traders

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Last Week's Close

E-mini S&P 500 Futures (March):  Settled at 3762.25, down 29.00 on Friday and 55.25 on the week

E-mini Nasdaq-100 Futures (March): Settled at 12,802.25, down 98.75 on Friday and 295 on the week

U.S. benchmarks are rebounding and overnight pared Friday’s losses. After an unenthusiastic reaction to President-elect Biden’s fiscal plan Thursday, a slate of weak economic data Friday added pressures ahead of the long weekend. However, sentiment has flipped as traders anticipate Janet Yellen’s Congressional confirmation hearing for U.S. Treasury Secretary before the Senate Finance Committee today. Here, she’s expected to sell Biden’s $1.9 trillion package in order to fast-track it with a 60-vote supermajority in the Senate. 

Still, an eroding jobs picture, along with fear that the consumer is slipping after an awful read on December Retail Sales and soft January Michigan Consumer data Friday, has the risk appetite on edge from elevated levels.

Earnings season is underway this week. Bank of America was mixed this morning, missing on revenue and was down more than 1% premarket. However, Goldman Sachs beat across the board and was up more than 2%. Also, Haliburton was a pleasant surprise with less of a loss than forecast. After the bell, we look to Netflix and JB Hunt.

Elsewhere, better-than-feared German ZEW Sentiment has helped lift the Euro and reinvigorate U.S. Dollar pressures. The Dollar Index finished at 1-month highs Friday on safe haven buying. On Sunday night, a slate of Chinese economic data was mixed. Although the closely-watched Industrial Production read beat expectations handedly again, GDP, Fixed Asset Investment, and Retail Sales all missed. This opened the door for added selling and commodities took a hit, but renewed USD weakness ahead of Yellen has helped risk assets reverse course.

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