Wake Up Wall Street (SPY) (QQQ): How long will relief rally last?
Here is what you need to know on Friday, May 20:
Options expiry and some likely position closing ahead of the weekend could and should allow equity markets to breathe easier on Friday after a nervous mid-week spell. Walmart (WMT) and Target (TGT) have hit sentiment hard, and we are back at extreme fear levels. However, despite this we are not back at new low levels as the SPY stabilized on Thursday. So is all the bad news now out there or is there more to come, and can we handle much more?
The Fed is nailed on for a series of 50 bps hikes this summer, and equity markets now have repriced consumer stocks aggressively to the downside. Energy stocks remain the best performers, but if consumer demand slows then oil demand will also suffer. China is attempting to offset this as it embarks on a more loose monetary policy right when the rest of the world is tightening.
The dollar index is weaker at 102.97, while right on cue oil is down 2% to $109.20. Bitcoin is at $30,100 and Gold trades at $1,842.
European markets are higher: Eurostoxx +1.5%, FTSE +1.3% and Dax +1.6%.
US futures are also higher: S&P +1%, Dow +0.7% and Nasdaq +1.3%.
Wall Street Top News (QQQ) (SPY)
Bank of England says inflation will rise to double digits.
China cuts interest rates by 15 basis points.
Tesla (TSLA), NIO, XPEV: China looks to extend electric vehicle incentives.
Pfizer (PFE): US recommends booster for kids 5 to 11.
Foot Locker (FL) up on relief earnings in line.
Deere (DE) misses on revenue, shares fall 4%, oh, deere.
DoorDash (DASH): Dashing to buy back stock, $400 million.
Deckers Outdoor (DECK) up 13% on earnings.
Boeing (BA) up on launch of starliner aircraft.
Palo Alto Networks (PANW) up on earnings.
Applied Materials (AMAT) misses on top and bottom lines.
The author is long IUSA and short Tesla and Twitter.