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 Streeta 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 NYs Williams, Bistib;s Rosengren, K.C.s George, Philly Feds Harker mostly Tuesday, the last on Wednesday, though thats the day Liu and Lighthizer, at the least, will be signing the first phase of the US-China Trade Deal. Mind you, its 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 Feds Beige Book would be the highlight of Wednesdays schedule, outside of earnings but that isnt 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 Fridays expiration of what were formerly LEAPSlong 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 bymarkets hitting new ALL TIME HIGHS Last Week. But thats 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 whos held became a winner. While all that expiration machinations will be Fridays 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 JPMorgans 38th Annual Healthcare Conference, in San Francisco. That, and the ICR Conference (for retailers, apparel manufacturers & restaurants) draw the most concurrent Investment bank eventssome 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 35 day weekend. And note, the upcoming holiday didnt deter the 101st American Farm Bureau Federation Convention & IDEAg Trade Show, starting Friday, in Austin TX, a city I dont 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 James10th Home Building & Wood Products Forum, ESG Edition, also in Canada. And the coming Monday Holiday, in a week, didnt 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 Id be remiss if I didnt point out the meeting of the FDAs Anesthetic & Analgesic Advisory Committees 3-day meeting to discuss and evaluate not one, not two or even 3 but 4 opioid drugs from Tuesday through Thursday. Whats wrong with that picture, when opioids are, supposedly, the scourge of our society?
Whether its 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 wont 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 youre protecting a long portfolio.
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 authors, alone, and should be just one part of more complete due diligence.
January 610, 2020 FIRST REAL WEEK of the NEW YEAR Its the first full week of the New Year, and itll 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, Barrons 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 BoEs Broadbent, the ECBs Lane, the BoJs Wakatabe, and the Bk of Canadas 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, theres a 3-session discussion of FOMC transcripts, and what can be learned from themwhether Central Bankers can be taken at their word. While the vast majority of speakers are academics, in addition to the Central Bankers, theres 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 Fridays December Unemployment Report.. While much of the rest of the weeks 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 Mexicos too. And we havent 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, BoEs 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 Polozs press conference. Later on the same day, St Louis Feds 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 its one of the largest VARsValue-Added-Reseller, whose business is a good read on corporate spending on technology.
If you follow consumer tech stocks, its the Consumer Electronics Show, in Las Vegas, opening the 7th, that makes you week. Samsungs keynote at CES, on the 6th, will delivered by H.S Kim, wholl 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 doesnt 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, wholl 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 SAESociety of Automotive Engineersare 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 IDCs very odd, "Building Next Generation Tech on a Foundation of Consumer Trust." Excuse me!!!! Where, exactly, does IDC see consumer trust?
If all that wasnt 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 PBSor 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 Sachs 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. Cant say I ever knew Texas was a Red River State. I have a very off color joke about that which Ill refrain from noting, in deference to good taste. Theres 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 ConventionLondon 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 countryOmaha 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, its an incredible busy week with the potential for Fridays Employment Report to be a landmine for market bulls. Lets 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 its only a mere 2 weeks until the next market holiday arrivesthe Martin Luther King Jr holiday, an event the NYSE celebrates by closing while still staying open for Veterans Daysomething I have, simply, never understood.
Ill give full credit to the bulls for shaving Fridays losses despite Trumps 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 theres nothing to fear from either Iran or Iraq, or a rogue Muslim zealot? We probably wont find out until we see retaliationand 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 authors, alone, and should be just one factor in complete due diligence. EARLIER, 2019 EXCERPTS HERE