Last Week's Close

E-mini S&P 500 Futures (June): Settled at 4176.25, up 13.75 on Friday and 56.75 on the week

E-mini Nasdaq-100 Futures (June): Settled at 14,029.50, up 15.50 on Friday and 200 on the week

Last week gave us everything we could’ve asked for: contained inflation, a firm start to earnings season, strong economic activity, and our intermediate-term upside targets being achieved. This week’s economic calendar won't test last week’s supportive footprint until Friday’s Flash PMIs, but we dive headfirst into earnings season and hear from both the Bank of Canada and the ECB ahead of next week’s FOMC meeting. 

Coca-Cola beat earnings expectations this morning, saying demand had returned to pre-pandemic levels, and IBM released theirs after the bell (Blue Line Capital owns IBM). Tomorrow, 6 companies with a market cap of over $100 billion report, including Netflix. 

Now, there are some lingering negatives from last week. First, although the 7-day moving average of new Covid-19 cases has dropped for 4 straight days in the U.S., it likely won’t drop for a fifth due to the weekend loll, and case counts in India and other parts of the world continue to surge. The recovery is certainly uneven throughout the globe, but this has also brought a tailwind to the Treasury complex and thus Tech’s rebound to fresh records. 

Secondly, China’s economic data, although firm, show that both GDP and Industrial Production fell shy of expectations. This, in and of itself, doesn’t yet call for concern, but must be monitored. All things considered, coupled with a contained Core CPI at 1.6% YoY, this affirms the Federal Reserve’s ultra-accommodative policy.

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