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Briefing.com Summary:
*The stock market is keying off moves in interest rates and oil prices.
*Dell (DELL) and Gitlab (GTLB) are up big after their earnings reports.
*New York Fed President Williams (FOMC voter) said recent data on inflation has been encouraging.
When the 10-yr note yield was idling above 4.81% overnight and WTI crude prices were kissing $92.00/bbl, the equity futures were stuck in a negative rut. That is no longer the case, and the line to their improvement can be traced to none other than the 10-yr note yield, which dropped back to 4.77% (currently at 4.79%), and WTI crude futures, which are now back below $90.00/bbl at $89.54.
There wasn't a specific news catalyst to account for the reversals. It was simply a trend interrupted by some seller/buyer exhaustion, rooted in a sense that perhaps for now the respective trends need some relaxation.
In any case, the equity futures market has shifted from presaging a negative start for the major indices to signaling a modestly mixed start.
The S&P 500 futures are up two points and are trading in line with fair value, the Nasdaq 100 futures are down 68 points and are trading 0.3% below fair value, and the Dow Jones Industrial Average futures are up 113 points and are trading 0.2% above fair value.
Some will point to the big gains in Dell (DELL) and Gitlab (GTLB) after their earnings reports as a basis for the support that has been offered to the equity futures market. That would be misleading to do so, however, considering they were seeing big gains earlier when the equity futures were tipped decidedly lower.
In other words, market participants were keyed in on interest rates and oil prices as their guidelines.
Some might say that comments from New York Fed President Williams (FOMC voter), who said in a CNBC interview that recent data on inflation has been encouraging, have helped turn the tide. They didn't hurt, but the truth of the matter is that the move to 4.77% and $89.54/bbl came in front of his remarks.
The same can be said for a soft-looking ADP Employment Change report for August, which showed private employers adding just 38,000 jobs (Briefing.com consensus: 47,000). That was bond-market friendly, but, again, it came after rates and oil prices had already come down.
What we have this morning, then, is a fickle market. That is partly a "vacation thing," with thinner trading volumes contributing to the swing trading, but it is mostly an interest rate thing. Where they go, the stock market will be swayed to follow in an inverse manner.
