US Trading- S&P 500 Futures are pointing to a modest decline of 4 points at 7:30 AM
- US 10-Year Treasury: 2.66%
- Oil: $55.55
- VIX: 14,94
- Dollar Index: 96.31
International Trading:
- Japan Nikkei: -0.37%
- China Shanghai: -0.67%
- Hong Kong HSI: -0.65%
- Singapore STI: -0.33%
- South Korea KOSPI: -0.27%
- Australia ASX: -0.94%
- UK FTSE: -1.2%
- German DAX: -0.12%
Global Growth Proxies:
- Silver: -0.16%
- Platinum: -0.19%
- Copper: +0.36%
Key Headlines
- Global markets are modestly lower across the board today, but with the big advances over the past few weeks, it should be no surprise.
- Jerome Powell will speak in front of Congress today and tomorrow.
FX
The pound looks like is nearing a big break out versus the dollar. Could be on its way to 1.42.
Government Bonds
US 10 Year- German 10-Year
US 10 Year vs Germany 10 Year Spread
German Government Bonds 10 Year Yield
What are the bond markets trying to tell us?
Most likely the U.S. bonds are still very attractive compared to global rates and the spreads for U.S bonds got too wide and are now reverting to the mean.
Lower rates are good for PE multiple expansion.
S&P 500 (SPY)
The S&P 500 is pointing to a slightly lower opening today certainly nothing horrible. There is a mild level of support around the 2,785 region. At this point, there is nothing to show a down day is the start of anything more severe. I don’t expect today’s sell-off to last. I would not be surprised to see the markets higher by days end.
Caterpillar (CAT)
Caterpillar Inc (NYSE:CAT) was downgraded to a Sell with a $125 price target at UBS today. The stock is trading lower this morning as a result. The downside in the stock now looks relatively limited, with a support level of around $132.
Home Depot (HD)
Home Depot Inc (NYSE:HD) is trading slightly lower after it reported weaker than expected fourth quarter results. Support for the stock is now around $182, and a drop below that level opens the door to a steeper decline. Overall the trends in the stock seem healthy, and the outlook Home Depot gave for 2019 sounds strong. I’d be surprised if the stock breaks support.
Exact Sciences (EXAS)
EXACT Sciences Corporation (NASDAQ:EXAS) is trading higher after Goldman Sachs (NYSE:GS) upgraded the stock to buy from neutral and placed a $120 price target on it.
Sage Therapeutics (SAGE)
Sage Therapeutic (NASDAQ:SAGE) priced 3.3 million shares last night at $150. Resistance on the stock is around $165.
Goldman Sachs (GS)
Goldman Sachs Group Inc (NYSE:GS) has struggled at the $200 level on many occasions and may be signaling a reversal on is on the way, and return to $183.
Facebook (FB)
Facebook Inc (NASDAQ:FB) is now facing resistance at $166, and I continue to believe this one eventually fills the gap.
