The S&P futures are down four points and are trading less than 0.1% below fair value; the 10-yr Treasury yield is up one basis point to 2.98% in front of today's record-size $26 billion auction; and the U.S. Dollar Index is up 0.1%. On the surface, there doesn't appear to be much happening, but in fact there is quite a bit happening beneath the surface of those indications.
The catch is that all that is happening is either not terribly surprising or not particularly "new." That understanding should bode well for the S&P 500 and its methodical assault on the all-time high (2872.87) that was set in January.
After all, the S&P 500 has gone up in each of the last four sessions amid an overarching degree of "sameness" on the news wires, which have been filled with better-than-expected earnings news, bellicose trade rhetoric between the U.S. and China, and the implementation of economic sanctions on Iran to name a few.
If anything is going to get in the market's way today, it could simply be the sense that it seems due to take a breather.
If the market is weak today, rest assured that weakness will be attributed to "trade concerns" now that it has been confirmed the U.S. will implement a 25% tariff on another $16 billion worth of imported Chinese goods, effective August 23.
That will be a convenient excuse, only because market participants already knew that's where the U.S. was headed, and yet the stock market has been climbing a wall of worry all along that has it on the doorstep of a new record high.
Protectionist trade measures matter, but the market itself hasn't elevated them yet to a level that rivals the bellicose rhetoric pertaining to tariffs and counter-tariffs. If it had, the S&P 500 would be in a different (and lower) place than it is today.
In any event, market participants are taking in the latest trade headline along with the latest batch of earnings reports, which have included a weaker than expected report from Walt Disney (DIS), a mixed report from CVS Health (CVS), an ugly report from Papa John's (PZZA), and a report from Snap (SNAP) that could be interpreted as weaker than expected or better than expected depending on one's viewpoint.
None of those reports, or the reaction to them, has made any true difference for the broader market, which is also still buzzing about the controversial tweet yesterday from Elon Musk suggesting he has the funding secured to take Tesla (TSLA) private at $420 per share.
Other items up for consideration this morning include China's trade balance report for July, which featured a better than expected increase in both exports (+12.2% year-over-year) and imports (+27.3% year-over-year), and today's record-size $26 billion 10-yr note auction at 1:00 p.m. ET.
There isn't any economic data of note out of the U.S. today, but some key inflation reports are in the offing with the Producer Price Index for July set to be released on Thursday and the Consumer Price Index for July due to be released on Friday.
Right now, there isn't much being released in the way of conviction by buyers or sellers. The major indices might start the day slightly lower, but overall, it's really more of the same.