There is a bid in the equity futures market following the assassination attempt on former President Trump at a campaign rally in Butler, PA. That isn’t the only factor driving the equity futures market, but it is a prominent factor rooted in speculation that the failed attempt has boosted Mr. Trump’s re-election chances.<\/p>\n\n\n\n
The connection for the market is that former President Trump is seen by many to be a more market-friendly candidate due in part to his push for deregulation and a lower corporate tax rate. Still, others worry that his push to increase tariffs could also lead to higher inflation.<\/p>\n\n\n\n
The disparate views are seemingly being reflected this morning in the positive leaning of the equity futures market and the negative leaning of the 10-yr note yield, which is up four basis points to 4.23%.<\/p>\n\n\n\n
The S&P 500 futures are up 22 points and are trading 0.4% above fair value, the Nasdaq 100 futures are up 78 points and are trading 0.3% above fair value, and the Dow Jones Industrial Average futures are up 218 points and are trading 0.5% above fair value.<\/p>\n\n\n\n
To be fair, more credit needs to be given where more credit is due. This isn’t only a politically-skewed bid.<\/p>\n\n\n\n
Dow component Goldman Sachs (GS)<\/strong> is trading modestly higher after its earnings reports; Apple (AAPL)<\/strong> is up 1.9% after being upgraded to Buy from Hold at Loop Capital; NVIDIA (NVDA)<\/strong> is up 1.4% with TD Cowen upping its price target to $165 and Morgan Stanley naming the stock a Top Pick; and Super Micro Computer (SMCI)<\/strong> is up 3.3% following the news that it will be added to the Nasdaq 100 on July 22.<\/p>\n\n\n\n Less attention has been paid to China’s weaker-than-expected Q2 GDP and June retail sales numbers, a profit warning from luxury retailer Burberry, and another soft reading for the New York Fed’s Empire Manufacturing Survey, which slipped to -6.6 in July (Briefing.com consensus -6.0) from -6.0 in June.<\/p>\n\n\n\n These items are presumably keeping the bid in the equity futures market from being stronger than it is, but clearly they have not upended the positive sentiment that can also be traced to the broadening out in buying interest, a favorable seasonal bias, and hope that the Fed will cut rates before the end of the year.<\/p>\n\n\n\n The latter hope was fueled last week by the June CPI data and testimony from Fed Chair Powell, who will be at the Economic Club of Washington, D.C., today for a conversation with David Rubenstein that is scheduled to begin at 12:30 p.m. ET.<\/p>\n\n\n\n Something else that is scheduled to begin today is the Republican National Convention in Milwaukee, Wisconsin, so one can expect the political narrative to be a prominent one in the market this week.<\/p>\n\n\n\n —<\/p>\n\n\n\n