February 10—14, 2020  POWELL TESTIMONY + I-BANK EVENTS RETURN    Let’s be honest, especially after Friday’s gangbuster January 225k jobs added, Powell’s Semi-Annual Testimony to Congress (Tuesday House & Wednesday Senate) trumps (if you’ll pardon the expression) another Earnings Calendar filled with more reports than seem justified, by now. Sure, markets were due for some profit-taking, after last week’s big gains, Monday thru Thursday but, surely, there was some trepidation about such a strong employment report, when the FOMC is supposed to be on hold for the year—or at least through the November elections. Not that anyone should expect a shock, when Jan. CPI is released, Thursday, especially when the price of crude has been collapsing (update to last week’s comment on prices at the pump: the price for Supreme did, indeed, fall by (-34c) p/gallon on Monday, right after the Super Bowl cleared out of town.)

Let’s swoosh past other Fed speakers, this week, for the moment, Fed Governor for Supervision, Quarles, speaking on Bank Supervision, @Yale Law School, delivering the Dean’s Lecture, just past noon Tuesday. However, unless something changed since Thursday, it’s not a speech that will be steamed. Maybe there’s a rule against streaming supporting Fedheads when the major domo (Powell) is speaking, live, on TV. Also Thursday, it might be interesting to see where William Dudley, former CEO of the NY Fed, goes in his discussion with current NY Fed CEO John Williams. Last we heard from Dudley, you might recall, he wanted to see the FOMC use its rate setting power to help push Trump out of office.

And, as Friday’s Jan Retail Sales are rolling off the presses, along with Dec Business & Retail Inventories, and as Jan Industrial & Manufacturing Production & Capacity Utilization arrive, half of Wall Street will be clearing out for the Washington’s Birthday/President’s Day holiday, come Monday, Feb 17th. While we’re on Friday, and the long weekend, note NADA’s (Automobile Dealers) Convention/Expo starts that day in Vegas, accompanied by Connect, for IoT vehicles, while ATD for Truck Dealers is being held concurrently, in Las Vegas, kicked off by J.D. Power’s Auto Summit.

Now, about the volumes of Earnings Reports expected, the crescendo on Wednesday & Thursday, there are some tech leaders like Akamai, Cisco, Alibaba, NetApp & nVidia, and pardon me, if I say so, tech companies not considered that way, like CME. Entire industries report this week, like the waste hauling & recycling industry, including Waste Connection Wednesday, Republic Services & Waste Management on Thursday. Toymaker Hasbro reports Tuesday and Mattel on Thursday, even as both prison operators, CXW & GEO report Wednesday. Hilton reports Tuesday, and Wyndham Hotels on Thursday. Check out other highlighted tickers, on the
Earnings Calendar, to see more names you might want to watch, including PepsiCo, Thursday, when an authority on employment, Kelly Services is also due to weigh in.

Which brings us to the Events Calendar, which includes the New York Designer Runway Shows, along with Ready-to-Wear shows, making for NYC gridlock. It makes sense for WWD to host its Beauty Forum in NYC, Wednesday, where the Fashion World will be assembling. Out in Palm Desert, CA, IAB—the Internet Ad Bureau Annual Leadership Meeting gets underway, in a week OmniCom is expected to report, Tuesday.

BIO CEO & Investor Conference starts Monday, in NY, which is why it’s a little odd that Stifel hosts Biopharma as a Ski Summit, in Park city UT, while the 17th ImmunoLBX Summit will be held starting the same day, in San Diego. Enercom, in Dallas, is a big energy conference,

One of the headline events of the week is sure to be Goldman Sachs’ 2020 Technology & Internet Conference, out in San Francisco. There’s, also, Cowen’s 41st Aerospace/Defense & Industrials Conference, in NY, while KBW hosts its winter Financial Services Conference, in Boca Raton, FL, and Guggenheim hosts Healthcare Talks Oncology, Day, in NY

Bill Gates is one of the AAAS Plenary Speakers, starting Thursday, as is WIRED journalist Maryn McKenna, and MSFT’ GM of Quantum Systems Krysta Svore. It’s worth noting that Orthopaedic Research has been meeting and will continue into Tuesday. MD&M—Medical Device & Manufacturing Conference/Expo meets concurrent with Electronics West/Advanced Manufacturing Expo/Conference, though Additive Manufacturing Strategies meets in Boston, starting Tuesday, too.

And I’d be remiss if I didn’t mention United Technologies 2-day Analyst Meeting for its spin-off companies, Carrier (HVAC) on Monday and Otis (Elevator) on Tuesday, when Visa will, also, host an Investor Day. Emerson, Johnson Controls, Enova Int’l, & Penske Automotive will all be meeting with investors, on Thursday.

But for all that, it’s really Powell, and the Goldman Sachs & Cowen Conferences that will rule trade, until the great exit before the 3-day weekend gets underway. Of course, that’s barring anything unexpected out of China and the coronavirus, which seemed to be slowing its spread rate over the weekend. Calm before the storm? Evidently. The death toll has reached 908, growing by 97, while the confirmed China mainland total cases rose to 40,171, even as new cases were reported in Spain, and at a French ski resort, where 5 British visitors were diagnosed but the cruise ship quarantined in Japan has been released., desepite a significant number of new cases on the ship

ECONOMIC: (Highlights, only, below. Complete International Economic Calendar here)

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

February 03—07, 2020 
  ANOTHER EARNINGS SLAM, IMPEACHMENT TRIAL TO END + SOTU ---IS THAT ALL?  In covering Economic Events on the highlights calendar, below, beyond domestic data, I concentrate on International "hotspots," if Aussies will excuse the reference. So, the UK thanks to Brexit, which finally happened at 2100 gmt, Friday, 01/31, Hong Kong because of protests (how long will China remain hands off?), China, always, because it’s the 2nd biggest global economy, and was heading towards first, until coronavirus, and Australia, because of the beastly bushfires that, thankfully, didn’t derail the Australian Open Tennis Championship, and the impact of China’s coronavirus stoppages (New Year extended another week, to keep travel and mingling to a minimum), and the impact on the Aussies’ natural resources exports, get the focus for now. Truth be known, while everyone’s been speculating on how Brexit will impact the UK, there’s been much less talk of how Brexit will impact the EU but that’s probably an oversight corrected as issues arise in coming days, weeks, and months. And while no one I’m aware of has put the two together, the EU’s main engine, Germany, barely grew, in recent quarters, it’s economic health now in question.

The Economic Calendar, overnight Sunday, promises China December & FY19 Industrial Profits, pus Caixin’s version of Manufacturing PMI. While local Sunday news claimed the actual number of Chinese coronavirus cases was up to 75K, prior to China admitting to an issue, there’s not much corroboration. And while the sight of deserted Chinese cities & highways is eerily spooky, the truth is China’s Lunar New Year causes atypical behavior, anyway, so the closure of "infected" cities to stop the spread of the virus seemed extreme, when first announced, the truth is, workers leave the cities in droves to return to their rural homes for the New Year, anyway. What really struck the most resounding chord, however, was the (-80.0)% drop in visits to Macau over the New Year holiday. Of note, too, Sunday night, is Hong Kong Q4 GDP, likely to have been seriously impacted by protests, curbing sales of luxury goods, to which HK is usually a large contributor. We’ll, also, hear Markit & partners’ Jan Manufacturing PMI for the Eurozone, France, Germany, Italy, & Spain. Also expected, Wards January US Vehicle Sales. With Fiat Chrysler, Ford, and GM reporting earnings this week, well hear a lot more granularity than usual.

Monday, Iowa caucuses will provide the first concrete numbers on the democratic candidates. And I’m partial to the ISM Manufacturing Index, over the PMI’s, ‘cause ISM seems to match up better with actual activity. The Treasury will Auction 3-, & 6-month Bills, Monday, and yet to be announced 4-week & 8-week bills, Thursday, but otherwise is out of the issuance market. Honestly, I could not find info on Atlanta Fed’s Bostic speech on Big Data, AI & Machine Learning but one of my most reliable sources says it’s a go. I can, on the other hand, confirm Fed Gov Brainard speaking on Payment Innovation, at a Stanford, CA, Symposium on Future Payments. Also Monday, the Fed’s Senior Loan Officer Survey. Monday night, Overnight, (the 4th, in local time), the RBA MPC will announce its Feb Target Cash Interest Rate. Given brushfires disrupting a good portion of the country, a rate hike is out of the question. On the other hand, given that the Australian Open Tennis Championship was able to proceed, as scheduled, suggests little need for a rate cut. But as mentioned, above, Australia is a big exporter to China, so that country all but closed down is bound to impact Aussie activity. Also overnight, Monday, Hong Kong Dec Retail Sales, business district protests likely to impact the luxury market especially hard.

Tuesday, revised Dec Durable & Capital Goods Orders & Shipments. Then, in the evening, Pres. Trump’s State of the Union Address, touted as extremely upbeat. Overnight, into Wednesday in the US, Caixin’s January Services & Composite PMI, and the same data for the Eurozone, France, Italy, & Germany from Markit and partners. ECB Vice President de Guindos will open the ECB conference on "Macroprudential stress testing & financial stability." Former Fed Gov Kohn is one of the more high profile speakers. Also overnight Tuesday an ECB Economic Bulletin, "Breaking the ‘chain effect’ of tariffs—foreign trade zones in a time of protectionism." Also, UK Jan New Car Registrations, and Markit/CIPS Services/Composite PMI, as well as Eurozone Dec Retail Sales.

Wednesday, the US Senate will likely vote to dismiss the Articles of Impeachment passed by the US House, ending the impeachment saga that mostly disrupted life for those still addicted to soap operas. Also Wednesday, the weekly MBA Mortgage & Refinance Applications, US Jan non-Manufacturing ISM Index, EIA weekly Petroleum/Gasoline/Distillates/Refinery Report, and Brazil’s Central Bank Interest Rate Decision. Overnight, into Thursday, China’s Jan. Trade Balance, possibly impacted only slightly by coronavirus shut-downs though New Year would have had a similar effect, falling in January, as it did, as opposed to February last year, and most years. ECB VP de Guindos is the opener at Santander's XXV1th Iberian Conference in Madrid, while ECB Chief Lagarde opens the Quarterly ECON hearing before the EU Parliament.

On Thursday, Fed Vice Chairman for Supervision, Randall Quarles, speas on Monetary Policy & the Economic Outlook at the NYU Money Marketeers meeting—a dinner meeting. All of the above is a long way of getting to Friday’s big data—not just the January US Unemployment Report but BLS’ Benchmark Revisions, as well. While the Street is expecting 180K, or so, jobs to have been added, any number above 150K probably will suffice. The Fed Board will submit to the Senate Cmte on Banking, Housing, & Urban Affairs, and to the US House Financial Services Cmte its July 2019 Monetary Policy Report, which the Fed Chairman testified to back in July 2019.

That brings us to Earnings, Alphabet (better known as Google, still) reports Monday evening, along with Check Point Software, The Hartford, Leggett & Platt. NXP Semiconductor, & Sysco—the other one, that delivers food to groceries. No doubt Alphabet’s report will set the tone for the week of Earnings, though there’ll be plenty more ahead. Tuesday, BP & ConcoPhillips report, along with Allstate Insurance, Chipotle Mexican Grill, Chubb, Clorox, Cummins, Eaton, Emerison, Ethan Allen, Gilead Sciences, L3Harris Technologies, Lancaster Colony, Match.com, McKesson Corp, Microchip Technology, Pandora Jewelers, Prudential Financial, Ralph Lauren, Royal Caribbean, Seagate Technology, Simon Property, Sony, Walt Disney, Waters Corp, and Zimmer Biomet. That’s a collection that nicely encapsulates a cross section of American industry.

Wednesday, highlights include Avalon Bay, Cabot Microelectronics, Capri Holdings (formerly Michael Kors), Coty, Energizer, Fox Corp, GM, Group 1 Automotive, Humana, IAC, M/I Homes, Merck, Met Life, Penske Automotive, Qualcomm, Spirit Airlines, Taylor Morrison Homes, and Yum China. Thursday, reports are expected from AGCO, Arrow Electronics, Baidu, Becton Dickson, Bristol-Myers Sdquibb, Cardinal Health, CDW, Columbia Sportswear, Estee Lauder, Fiat Chrysler, Intercontinental Exchange, Kellogg, Merdith Corp, Mettler-Toledo, Motorola Solutions, New York Times, News Corp, Penn National Gaming, Philip Morris, Pinterest, Post Holdings, Regeneron Pharma, S&P Global Intelligence, Skeckers, Spirit Aerosystems, Synaptics, T-Mobile, Take-Two, Tapestry (formerly Coach), Twitter, Tyson, Verison, Willis Towers Watson, Wynn Resorts, and Yum Brands.

Friday, the schedule lightens up, with notable reports from AbbVie, ASE Technology, Canada Goose, Chicago Board of Trade, and Hanes Brands. If Equities can get through the Earnings dump, this week, and coronavirus isn’t cited as a reason to lower Q2 estimates, it’s altogether possible the worst of the virus sell-off will have ended by week’s end. Of course, passive investors of all stripes will have to get over the fact that their stocks probably didn’t rise despite what sounded like relentless gains in stocks, most of the month, until late in the month. Surely, Trump will talk up stocks Tuesday, during his SOTU, and probably blamed last year’s Fed rate hikes for the fact that stocks weren’t higher, still, to end the year.

Which brings us to events, InterSolar North America, starting Tuesday, one big event, MAGIC—the enormous apparel, footwear & accessories market an even bigger event, in San Diego & Las Vegas, respectively. Both draw a number of sub-events, yet oddly, FFNY—fancy footwear--is in NY, while most of the shmata industry will be in Vegas. And even stranger, the New York Fashion Week, the one known for designer runway shows, starts for Men, Monday, and for Women, Friday. EEI—the Edison Electric Institute holds a one-day Wall Street Briefing, Wednesday, when the Cattlemen’s Beef Association will meet in San Antonio TX. Why, then, does Feed & Grain meet in Iowa? Beats us! ORS for the Orthopaedic Research Society, starts next Saturday, the aforementioned ZBH earnings report, mentioned above, more than a hint about how that group is faring.

Because of the crush of Earnings reports scheduled, I-banks are mostly AWOL this week. An exception is Stephens, starting on the 3rd, when it kicks off its Regional Banks Investor Trip to visit these tickers: ABTX, BSX, BSVN, BOKF, CBTX, CMA, CFB, FFIN, GNTY, HTH, IBTX, PB, STX B, TBK, VBTX (Dallas TX thru 5th) Otherwise, UBS is partying at NAPE, Thursday, though the Wildcatter’s Ball Friday is the better known evening entertainment. Those larger I-banks that were engaged, probably were at SPIE Photonics West, continuing through the 6th, in San Francisco, or at APEX Expo/PC Printed Circuit Expo, in San Diego, both of which started on the 1st. and runs through the 6th. New York won’t be home to just fashion, this week but will also host New York NOW, formerly the NY International Gift & Housewares Show.

All in, a busy Economic & Earnings Calendar will define the week, the number of cases of coronavirus in the U.S., to date, still quite small. And, if you think about it, even 75K cases in China—a country with 1 billion people—doesn’t sound terrifying, in perspective, though no doubt it is for the relatives of those 75K. Put the 220, or so who died, in perspective, in relation to 1 billion total citizens, and that doesn’t sound so scary, either. And in a control economy, it’s not hard to imagine those infect, first, avoiding medical help, initially. China has already started larg injections of cash into the economy, to steady things. Clearly, US stocks were aching for an excuse for profit taking—and found one in coronavirus. But having raised cash, in early January, I’m not sorry to see a sell-off. I just hope I know when to capitalize on the carnage with some buys. And in the meantime, I'd love to see the price of gas at the pump come down, like crude has. So far, not but, perhaps, a Super Bowl just 36 miles away has helped keep prices elevated, through this weekend.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence.  
January 27—31, 2020   WHAT FOMC MEETING?    While some are anticipating a potential tweak to what the Fed pays on reserves left with it, that really would defeat the purpose of all its injections in the REPO market. You don’t get banks to step in they way they used to in the REPO market by paying them more on the dead money they’re forced to deposit at the Fed as a capital buffer. Why would the
Fed do that? Beyond that, everyone and his uncle expects the FOMC to be on hold until after the November elections, at the least, so this is one Fed meeting that might be forgotten in a blink. Or as I said in the title, "What Meeting?"

Because of the FOMC meeting, Fedheads aren’t speakers of note this week. Yes, NY Fed’s Williams keynotes a NY Fed Pitch Event but that has to do with Puerto Rico, so won’t be a US Policy statement. The Bank of England meets this week, too, with Gov Carney’s last post-meeting Press Conference early Thursday morning, before US markets open. Set for his term to expire on March 31st, his replacement has already been named, so no reason to dally. There’s no reason to expect the BoE to act, given that Brexit is supposed to take place on Friday, Jan 31st, and if anything, a rate cut could make more sense than a hike, while it doesn’t appear that England has suffered, terribly, as a result of Brexit, or even the delay. If anything, Prime Minister’s Boris Johnson won an even bigger mandate in December, so the country is behind Brexit, even if all the t’s aren’t crossed, nor I’s dotted. The whole "Brexit" doomsday scenario reminds of Ed Yardeni predicting planes dropping out of the sky, when the calendar turned 2000 from 1999. It didn't happen, nothing even close happened. Even Florida, of hanging chad fame, managed to keep electricity pumping through the wires to homes and businesses. Brexit doom? Too much ado about nothing.

China, because of the coronavirus, by the way is on lock down for the New Year, which is a crying shame. First, the tradition is to pass around money in red envelopes, that then get spent, and second and more important, New Year is when workers squeeze onto a train to leave the city and go back home to their rural families. Lock down cities, airports, trains and other forms of transportation, and it’s possible some workers won’t see their families for another full year. Of course, a country that can build 2 new hospitals in a week can manage to declare a 2nd holiday to duplicate the period denied during the Chinese New Year. Meantime, But the economic injection from red envelopes may be MIA this year, too. Donchya think shopping centers, clubs, and other places where people mingle and hang out will be locked down, next, if not already?

Don’t look know but the Treasury is in a sudden rush to issue a ton of debt--$243B, in the 3-days, Monday through Wednesday, if my calculations are correct. Anyone remember when the Republicans were the standard bearers of lowering US Federal debt? Ahh, the good old days. We need a Great Thunberg to get on Congress, and Republicans, in particular, to stop the spending. If they can’t see climate change as a risk, perhaps debt will wake them instead.

The rest of the Economic Calendar promises Dec New Home Sales on Monday, the S&P Case/Shiller Nov 20-city US Home Proce Index on Tuesday, plus Realtors’ Dec Pending Home Sales on Wednesday. Away from housing, the IRS will start accepting personal, Federal Tax Returns on Monday, while Tuesday promises US Dec Durable Goods & Capital Goods Orders & Shipments. SONT—State of the Net is an annual meeting organized by Congressional workers. At one time, the biggest clash was over the US turning management of the internet over to ICANN but that’s come and past without much notice. Also Wednesday, Dec. advance Trade Balance, Wholesale Inventories, and Retail Inventories, plus EIA’s weekly Petroleum, Gasoline, Distillates, and Refineries status. OPEC is expected to release its monthly member production report a day later, before US markets open. Thursday, Advance Q4 GDP is expected, and with it, Business Investment, Consumer Savings & PCE, the latter the Fed’s choice of inflation measurement. Friday, Dec Personal Income & Spending includes a monthly look at PCE.

Which brings us to Earnings, a calendar as plump as any, in any week of the reporting season. One Street wag claims 30% of the S&P will report this week. Who am I to argue? What I do know is that AMD & Apple report Tuesday, Facebook, MasterCard, McDonald’s, Microsoft and Tesla on Wednesday, Amazon on Thursday, and both Chevron & ExxonMobil on Friday. We’ll also hear from a large portion of the megacap defense companies (Tues.: LMT & United Technologies; Wed. Boeing, General Dynamics, GE, then Thursday Oshkosk, Northrup Grumman, leading to Friday’s Honeywell.) Homebuilders are well represented this week, with D I Horton Monday, Pulte Homes Tuesday, Meritage Wednesday, and Beazer on Thursday but let’s not overlook suppliers like Whirlpool Monday, Scotts Miragle-Gro and Stanley Black & Decker on Wednesday, or Sherwin Williams on Thursday. And then there’s are a handful of rails, including 2 from north of the border, plus megacap healthcare companies like Pfizer on Tuesday, Alexion, Amgen & Biogen on Thursday, along with AT&T on Wednesday, plus Verizon on Thursday, when Visa also reports. But trust me, that only scratches the surface of coming earnings reports. The Earnings Calendar is worth a close look not for the sheer number of companies reporting but because the middle weeks of Earnings Season is when stocks, typically, pull back, until the deluge weeks are complete, and PM’s decide the reports were not as bad as they could have been. And even if they are this week, which banking behemoths gave us no reason to believe is likely, it can all be blamed on the trade war, which entered truce this month, when Lui He and Trump signed the phase 1 agreement, mostly about agriculture. Let’s not forget, Huawei’s CFO is sitting in a Canadian prison, at the US’s request, and demands for extradiction could be the subject of a court case this week, even as Trump’s Impeachment Trial proceeds.

And make no mistake, the NY Time’s bombshell from John Bolton’s book, that Trump directly tied the withheld $400B in aid to Ukraine to that country’s announcement of an investigation into the Bidens could, potentially, sway some Republicans who decided to leave Congress, after this year, or some moderates who really could put country before politics. Had the whisttleblower’s report not been made known, Ukraine could still be waiting for that aid, or would have already announced the investigation Trump wanted, just to get the aid. Brain injuries suffered by US service people in Iraq, when Iran revenge bombed US bases, were referenced dismissively, by Trump, as "little headaches." That may have gone too far for some Republicans in Congress. You can mess with anyone but never veterans or service people who were injured on duty.

Which brings us to Events, where investment bank hosted conferences are slim, due to Earnings Season, even as one of its own, Goldman Sachs, plans an investor day, Wednesday—its first in 5 years or more, and surely the first without Blankfein. The Event Calendar is heavy with healthcare-related events, Food Marketing Executives & Organic Food, .FIG Partners, now owned by Janney, hosts West Coast CEO in Phoenix, starting Wednesday, timed to follow Bank Director Acquire of Be Acquired, an annual conference, in that city, starting Sunday, as I write. Other notable events include Philly National Candy, Gift, & Gourmet Show and Inside ETFs, and IEEE Radio & Wireless Week, all starting Sunday. Monday, Tour d’Alis is the Americas Lodging Investment Summit (ALIS), a group hard hit by coronavirus, in the few days the presence of that virus has been disseminated. For many tech investors, DesignCon, Where the Chip Meets the Board, is a big event but with Sanmina, Lam Research, and other Semi Equip names reporting results, there’ll be a surfeit of information, including at SAW Hybrid & Electric Vehicle Technologies Symposium, which starts Tuesday.

Speaking of Tuesday, in a case of perfect timing, ASM--the American Society for Microbiology meeting starts that day, Biothreats the original topic, coronavirus, surely, a prime topic of conversation, if not abstracts and/or poster sessions. The first person diagnosed in Chicago was said to be doing well in a hospital. Evidently, her case was mild or the antivirals they’ve given her are working. That’s the first we’re getting word of a person stricken recovering. Also Wednesday, CIBC hosts its 23rd Annual Western Institutional Investor Conference, in Banff AB, Canada. Besides GS’ Investor Day, Kinder Morgan hosts its own in Houston, while TD Ameritrade hosts its National LNC Conference, in Orlando, starting the same day.

Otherwise, End of Month, 2 major Central Bank Meetings, plus a slug of Earnings Reports will occupy Street interest, a pullback continuation of last week’s action quite typical of this stage of Earnings Season, so get ready for talking heads to urge one and all to use the pullback as an opportunity to scoop of fallen shares. It’s what they’re paid to do. Normally, as we enter February, I’d been looking for June call options to buy on energy stocks. Typically, the oils bottom in February, and rise into Memorial Day. Given how beaten up the oils are, it’s something to keep in the back of your mind, if the coronavirus doesn’t become more significantly widespread outside China.

R.I.P. Kobe Bryant and all those who died with him.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

January 20—24, 2020   NOW the EARNINGS RUBBER REALLY MEETS THE ROAD    Now that all the big money center banks have reported, hundreds of smaller banks are slated to weigh in, along with major regionals like Zions Bancorp, major credit card & auto loan lenders American Express, Ally Financial, Capital One Financial, Discover Financial Services, & Synchrony, smaller brokers like Interactive Brokers & E Trade Financial, and a large international bank, UBS Group. Additionally, heavy hitters like Intel & IBM, Abbot Labs, Johnson & Johnson, Procter & Gamble, United Airlines, Netflix, American Airlines, Comcast, ST Microelectronics, Travelers, & Union Pacific, though you’d be well-served to, instead of stopping here, checking out all the emboldened tickers on the Earnings Calendar which is, admittedly, missing at least 50 smaller banks that aren’t within our coverage universe.

Pres. Trump was scheduled to speak at the 101st American Farm Bureau Federation Convention and IDEAg Expo but given Monday’s holiday, and Tuesday’s start of the Impeachment trial in the Senate, it’s difficult to believe there’ll be much interest in a 48-hour old speech, by the time markets reconvene. He’ll speak again at the World Economic Forum in Switzerland but given the time lag, and the Impeachment trial, the only thing the media will be interested in, from Switzlerand, is catching other foreign leaders making fun of Trump, or Trump managing to embarrass himself, as he has at other global gatherings, when he’s tried to muscle into the middle of a line of world leaders, standing shoulder to shoulder without him. Trump will not be the only famous American speaking at Davos, as the Economic Calendar bravely details. Those sessions that are streamed will be streamed from WEForum.org, only, as far as we know.

The Bk of Japan has a Monetary Policy Meeting that ends on Japan’s Tuesday, overnight, Monday, for us. The Bk of Canada MPC also meets, its statement expected on Wednesday. Early Thursday morning the ECB MPC will weigh in, too, Lagarde’s press conference not so early in the a.m., that many traders won’t catch it live, before some traders make it into their offices. The BoJ weighs in, again, overnight Thursday, releasing minutes of its December 18—19, 2019 MPC Meeting. The Chinese New Year celebration kicks off Friday, which pretty much puts China out for 12 days, the actual New Year on the 28th, early this year. Many years, the Chinese New Year is closer to my birthday, which means just a couple of days prior to Valentine’s Day. That, so it’s said, occurs on a Friday, which is really good for restaurants.

Other items on the Economic Calendar, of note, include housing data Wednesday, from FHFA & Nat’l Ass’n of Realtors. Petroleum stats won’t arrive until Thursday, because of the MLK Hoiliday, Monday. Otherwise, the Events Calendar is a little all over the place. In addition to the Farm Bureau previously mentioned, there’s Retina & ACC’s Cardiovascular Conference, a Veterinary Conference, then imprinted Sportswear, Halloween, Costume, Party & Special Occasion Show, and Men’s Haute Couture shows in Paris. Retail Leaders moved from Northern Florida, and the ICRConference, south to Palm Beach for RILA—the Retail Leaders CEO Forum. While the press will heavily cover what’s going on in Paris, France, New York will be home to the Men’s Contemporary Fashion Market, while San Francisco will host Winter Fancy Foods.

Women’s Haute Courture (Designer Runway) Shows start in Paris Monday, when Bloomberg—the TV channel, not the candidate, will move to Switzerland for single-day events concurrent with WEF. But note, too, the CEO’s of Goldman Sachs, IBM, Bk of America, and Salesforce.com, are speaking in Davos, too, so some left shortly after they reported earnings last week, while Ginni Rometty will, perhaps, phone it in for her company’s Tuesday earnings report. Note Trump will not be without friends in Switzerland, his Treasury Secretary, Steve Mnuchin is a speaker overnight Thursday into Friday, a panelist with ECB Chief Christine Lagarde.

The National Association of Home Builders (NAHB) hosts a big show in Las Vegas, starting Tuesday, which also happens to be the first trading day after January options expired. I mention that because some of those options that expired, could have begun as LEAPS as much as 2 years 3 months ago. There’s no other month in which that can happen, except with custom designed options that the wirehouses arrange for big clients. Because it’s a big week for earnings, after a 3-day weekend, not many I-banks have events scheduled in the US but Jefferies does, starting Tuesday, in Beavercreek Colorado. Meeting in the same city, Beyond A Million Genomes: From Discovery to Precision Health. Also starting meetings that day, NATPE (TV Program Execs), World Stem Cell Summit (Miami), the PGA (Professional Golf Association) Merchandise Show, and MPMC Media Trade Council Conference—from SEMA, Wheel & Tire Council.

Wednesday, Barclays breaks the earnings week ban with an Insurance CIO Conference & Roundtable., also in Palm Beach. Somewhat ironically, CFANY hosts its 5th Insurance Company CIO Roundtable in NY. The ICSC (Shopping Centers) meet in Miami for Nexus Conference, which has a LatAm flair. Los Angeles hosts CannaWest, a Cannabis Conference, while TD Securities is hosting Mining, in Toronto Canada. I Imagine the Iowa Pork Congress, in Des Moines, starting Wednesday, will be jolly affair, given China has had to slaughter pigs to stop swine flu, and had to buy heavily to satisfy demand for the New Year. ASHA, the American Senior Housing Ass’n meeting that starts Wednesday, contrasts with NMHC—Multifamily Housing Council’s Strategies Outlook & Annual Meeting, starting Sunday, as I wrote, since ASHA manages to extract $3,500--$8,500 per suite at Assisted Living Centers. Some, like country clubs, even demand hundreds of thousands in upfront "membership fees."

Friday, AFIB (Atrial Fibrillation) is the subject of a Symposium, in D.C., despite the ACC Cardiovascular Conference which ran through the 22nd, in Snowmass, and next Saturday, the Society of Cario-Thoracic Surgeons Annual Meeting & AATS Tech-Con get underway in New Orleans. Evidently, you can pick music, or sun & surf, or skiing, if you’re a heart doctor. ASCO’s Gastrointestinal Cancers Symposium starts Thursday, when Renewables & Wholesale Electricity Markets meets in Houston, & CoalTrans in Miami. Also next Saturday, Winter Clinical Dermatology Conference for Dermatologists (as opposed to GP’s), in Maui, Hawaii, despite their constant warnings about skin cancer. Also next Saturday, Winter Rheumatology in Snowmass Village, Midwinter Conference of Immunologists, and SLAS2020., the Society for Laboratory Automation Science, all very big conferences in terms of volume of attendees, for some, because of the setting, in particular.

All in, it’ll be one heck of a busy week, for a 4-day week, with the potential for Earnings to weigh on the bulls’ party. That’s not to say stocks have to collapse, from here. On the contrary, with the Trade War in a truce period, and many Republicans too sure of Trump’s innocence to worry about the impeachment trial—if Senate leader Mitch McConnell even allows anything approaching that term, and the bulls impassable, to date, there’s no collapse coming but a softer market is not beyond the realm.

ECONOMIC:  (Highlights, only below. Full International Economic Calendar here) 

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 13—17, 2020 
IT’S ALL UP to the FINANCIALS    When JPM surpassed $140 and started taking the rest of the major banks with it, I started trimming my stakes in some names. The Fed had cut rates 3x, which isn’t good for banks, I thought, when I noticed something others, surely, notice too. Quick to raise rates in lock-step with rising Fed rates, they are very slow to lower rates. That means the banks are making a fortune on credit cards, whose rates rose for a couple of years, and may not come down one bit, now.

And it is all up to the banks, who dominate the Earnings Calendar, this week. And not just any banks but Citi, JPMorgan, Wells Fargo, Bk of America, BlackRock, Goldman Sachs, PNC, US Bank, Bk of NY Mellon, Morgan Stanley, Charles Schwab, Citizens Financial, Regions Financial, and State Street—a collection without peer. Yes, Delta Airlines, United Healthcare, CSX & Kansas City Southern, plus Taiwan Semiconductor report as well but the spotlight will on the financials, especially.

There are a few Fed speakers, this week, including NY’s Williams, Bistib;s Rosengren, K.C.’s George, Philly Fed’s Harker mostly Tuesday, the last on Wednesday, though that’s the day Liu and Lighthizer, at the least, will be signing the first phase of the US-China Trade Deal. Mind you, it’s a deal whose terms are unknown, except to those most directly involved, beyond $50B worth of Ag products China is supposed to buy from the US, over 2 years. During any other given week, the Fed’s Beige Book would be the highlight of Wednesday’s schedule, outside of earnings but that isn’t likely the case this week. Anecdotal comments from various Fed districts? Give me a break!

The other interesting facet of the weekly Economic Calendar, as presented, is Friday’s expiration of what were formerly LEAPS—long term Options that could have been contracted as long as two years and 7 months ago, if not more. One of the hardest things to do under Trump has been to hold on for dear life and not trade away winners that because even bigger winners, as time went by—markets hitting new ALL TIME HIGHS Last Week. But that’s really about a small handful of large cap names, rather than the run of the mill stock but still, stocks have hit new highs, so someone who’s held became a winner. While all that expiration machinations will be Friday’s business, it also pays to notice that the markets are closed on the 20th, to celebrate Martin Lither King Jr.

As for Events, the big kahuna is JPMorgan’s 38th Annual Healthcare Conference, in San Francisco. That, and the ICR Conference (for retailers, apparel manufacturers & restaurants) draw the most concurrent Investment bank events—some tied to the JPMorgan Conference, merely identified by their city, San Francisco. ICR, however, draws any number of events scheduled to coincide, suggesting that interest in consumer-facing names is undiminished, no matter how poorly most of retail has been doing. ICR is in Orlando FL while, ironically, the NRF Vision Show, aka the BIG SHO)W, will be in NY, as per usual.

Peters & Company hosts its Winter Energy Conference in Canada, starting Wednesday, when US events start winding down, due to the King holiday, that will be stretched into a 3—5 day weekend. And note, the upcoming holiday didn’t deter the 101st American Farm Bureau Federation Convention & IDEAg Trade Show, starting Friday, in Austin TX, a city I don’t believe has hosted it before. Perhaps the 2020 election campaigns diverted the event from Iowa, and other more typical farm states that have hosted it in the past.Also notable, but on Thursday, Raymond James’10th Home Building & Wood Products Forum, ESG Edition, also in Canada. And the coming Monday Holiday, in a week, didn’t deter ACC, Retina, or Veterinarians from hosting conferences that start on Saturday, each in a city favorable to long weekends, respectively, Snowmass CO, Hawaii, & Orlando.

And I’d be remiss if I didn’t point out the meeting of the FDA’s Anesthetic & Analgesic Advisory Committee’s 3-day meeting to discuss and evaluate not one, not two or even 3 but 4 opioid drugs from Tuesday through Thursday. What’s wrong with that picture, when opioids are, supposedly, the scourge of our society?

Whether it’s time to start getting more serious about profit-taking, will depend on what the major, money-center banks report. But even then, if they deliver, markets won’t be in the clear. Stocks usually suffer in the 3 weeks after the banks report, until the market, collectively, decides Earnings reported could have been a whole lot worse than those delivered. Buying some protection may be a waste of money, given how the market refuses to go down and stay down but, then, what a way to waste a little money, if you’re protecting a long portfolio.

(Highlights, only, below. Full International Economic Calendar here)

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one part of more complete due diligence.

January 6—10, 2020  FIRST REAL WEEK of the NEW YEAR   It’s the first full week of the New Year, and it’ll start with a bit of a bang. Central bankers are speakers, and the first of December sales news will be released Wednesday, the 8th, at 4:15pm et, by Costco, more on the 9th, as those retailers who still report sales monthly release Dec sales, too. Also, Wednesday, Bed Bath & Beyond reports its quarter, comments on December sales sure to arrive, then, too. Also Wednesday, Constellation Brands reports its quarter, comments on December sales sure to accompany the release, even as Walgreens Boots Alliance reports, Wednesday, as well, Barron’s particularly negative on its results, which surprises me a little. CVS gave up selling cigarettes a few years ago, leaving that kind of walk-in business to WBA, alone, in most of the drugstore world. Yes, supermarkets & Walmart, for one, still peddles cigarettes but for parking convenience, few offer the close-in spots available at drug stores.

Now, to those Central Bankers mentioned, we start with NY FRB Pres/CEO John Williams, a panelist, as I type, at the AEA/ASSA Annual Winter Meeting in San Diego. AEA is the Association Economists, ASSA the Association of all Economic/Social Societies, of which there are 11, if I recall, off hand. Other panelists appearing wit him include the BoE’s Broadbent, the ECB’s Lane, the BoJ’s Wakatabe, and the Bk of Canada’s Dpty Gov, Wilkins. Their topic is "Monetary Policy Frameworks in a World of Low Interest Rates." Earlier in the day, at the same meeting, a panel of past Central Bankers that includes Janet Yellen, Olivier Blanchard, Lawrence Summers (technically, a Treasury official, not a central banker), and Adam Posen dicusses "Japanification, Secular Stagnation & Fiscal & Monetary Policy Challenges,: also at AEA/ASSA Annual. At 10:15am pst, there’s a 3-session discussion of FOMC transcripts, and what can be learned from them—whether Central Bankers can be taken at their word. While the vast majority of speakers are academics, in addition to the Central Bankers, there’s a smattering of corporate economists, not just from the obvious, financials, but from corporates like Microsoft & Caterpillar, all of whom have to form an economic forecast to direct their companies’ future.

As is typical of the first full week of a month, the week will be full of all kinds of data, Treasury Auctions, and culminate in Friday’s December Unemployment Report.. While much of the rest of the week’s data is for November, it might be more instructive than usual, if the end of the GM strike caused a surge in orders, not just at US factories but Mexico’s too. And we haven’t heard the last of the Central Bankers, either, once AEA/ASSA ends. On Wednesday, Fed Gov. Lael Brainard will discuss "Modernizing the Community Reinvestment Act," at the Urban Institute, while in the early hours of Thursday, BoE’s soon to be leaving Governor, Carney, will open "The Future of Inflation Targeting," a conference at the BoE whose URL was not to be found but which will host NY FRB Pres./CEO Williams, on Inflation Targeting. Also Thursday, Fed V. Chair Clarida will discuss "U.S. Economic Outlook & Monetary Policy," at the Council of Foreign Relations’ C. Peter McColough Series on International Economics, in NY, even as the Bk of Canada will wrap its first monetary policy meeting of the year, with release of a statement and Poloz’s press conference. Later on the same day, St Louis Fed’s Bullard speaks to the Wisconsin Bankers Association Economic Forecast Luncheon, an event he attends almost every year.

Of course, the December Unemployment Report will decide the fate of the markets, for Friday, at the least. Of course, results from Lennar on Wednesday, and KB Homes on Thursday, will also trigger pencil sharpening by economics, with rates, again, scrapping very attractive lows. The last Earnings Reporter who should pay attention to is Synnex, because it’s one of the largest VARs—Value-Added-Reseller, whose business is a good read on corporate spending on technology.

If you follow consumer tech stocks, it’s the Consumer Electronics Show, in Las Vegas, opening the 7th, that makes you week. Samsung’s keynote at CES, on the 6th, will delivered by H.S Kim, who’ll discuss where consumers are headed, and the blending of physical and digital worlds---what Kim refers to in a blog as the "Age of Experience." Time was, Microsoft was the annual keynote but, now, like Apple, it doesn’t even purchase exhibit space, which is not to say it will be completely absent. On the contrary, it will have hotel suites to receive analysts, who’ll be at CES in droves, as the Events Calendar makes clear. The number of events listed "@CES" are numerous, and include not just consumer technology but autos, too, JPMorgan hosting an Auto/Tech Forum @CES, and Citi a Global TMT West Conference, at CES. Likewise, the SAE—Society of Automotive Engineers—are hosting Connect2Car at CES. Facebook & Instagram plan a briefing at CES, while Intel is one of the other keynotes, and is holding a press conference, at CES, while its Mobileye division is, also, hosting a CES press Conference, both of them on Tuesday. Other concurrent events, at CES, beyond the many I-bank "hosted meetings" and exhibition tours, include Kids @Play, and IDC’s very odd, "Building Next Generation Tech on a Foundation of Consumer Trust." Excuse me!!!! Where, exactly, does IDC see consumer trust?

If all that wasn’t enough, the TV Critics Spring Press Tour starts this week, on Tuesday, at FOX, now a Walt Disney Company. As the week progresses, the TV Critics Spring Press Tour will look like a nearly all Walt Disney event, thanks to the many Fox division it picked up with its recent purchase, not to mention its own ABC on Wednesday. Not until Friday does someone other than Disney entertain the TV Critics, and that day its PBS—or Public Broadcasting Services, which Trump had, at one time, threatened to stop funding with government money. Debuting Friday, when "Like a Boss," opens in movie theaters, the first film to sport the new, combined ViacomCBS logo.

Other big events, otherwise, include Goldman Sach’s Global Energy Conference, starting Tuesday, and the Credit Suisse 2020 Aircraft Leasing Conference, both starting Tuesday. Wednesday, CJS Securities’ 20th Annual New Ideas for the New Year Conference, and ICSC (Shopping Centers) Red River States Conference & Dealmaking event, in Ft Worth TX. Can’t say I ever knew Texas was a Red River State. I have a very off color joke about that which I’ll refrain from noting, in deference to good taste. There’s a Commercial Real Estate Forecast Conference, starting Thursday, when Raymond James hosts a Deer Valley Telecom Summit, and the Correctional Association hosts its annual event. For whatever reason, London is where the Beef Industry is hosting its 21st Annual Convention—London Ontario, Canada, I should specify, as opposed to the London UK, where Citi is hosting European Insurance, and TD Securities an Energy Conference, even as Credit Suisse is in Hong Kong for a Greater China Technology & Internet Conference, wile Jefferies is in the same city for a Consumer Corporate Day 1x1, and Citi a Hong Kong & China Corporate Day with a Healthcare Theme.

Friday, the Annual ASH (Hematology) Review hits both NYC & Seattle Washington, just 2 out of 10 stops early in the New Year. The American Bus Association Marketplace & BusWorld Academy take place in Berkshire country—Omaha Nebraska, while Brussels hosts the European Auto Salon, where overseas automakers are more likely to introduce new models than they are at any US based auto event. Saturday, East/West Biotech CEO opens in NY, while Plant & Animal Genome opens in San Diego, and Color Management 20, a PIA/GATF Conference & Expo opens in San Diego too.

All in, it’s an incredible busy week with the potential for Friday’s Employment Report to be a landmine for market bulls. Let’s not overlook the fact that retailers start laying off seasonal help after Christmas, even though physical stores are often busier with bargain hunters & people toting returns after Christmas, into January. And it’s only a mere 2 weeks until the next market holiday arrives—the Martin Luther King Jr holiday, an event the NYSE celebrates by closing while still staying open for Veteran’s Day—something I have, simply, never understood.

I’ll give full credit to the bulls for shaving Friday’s losses despite Trump’s bombing Iran, taking out a revered general there, and escalating the temperature of the US enmity with Arab countries who Trump threw over the side as soon as he was inaugurated--withdrawing from the nuclear disarmament deal signed by a predecessor. How long can the bulls pretend there’s nothing to fear from either Iran or Iraq, or a rogue Muslim zealot? We probably won’t find out until we see retaliation—and where that occurs. The closer to home, the more unsettling it will be.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

Sandi Lynne 2020 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in complete due diligence.  EARLIER, 2019 EXCERPTS HERE

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