Equities are trying to bounce back after a rough couple of days here. Gold, silver, crude oil, Treasuries, and the dollar are mostly flat.
On the news front...
I’m back from the MoneyShow/TradersEXPO Las Vegas, which means I’m back in the saddle with your MoneyShow Market Minute! Stocks shed some ground during the conference amid renewed banking and economic concerns. But the damage has been relatively contained so far, and as I said on stage at the Paris Las Vegas yesterday, it’s not that bad out there...REALLY.
That said, GDP growth in the first quarter left something to be desired. The economy expanded just 1.1% on an annualized basis, below the 2% that was expected. An inflation gauge called the Core PCE rose 4.9%, just a bit more than the 4.8% economists were looking for.
On the earnings front, “Big Tech” names continue to hit the ball out of the park. In the wake of strong numbers from Microsoft (MSFT) and Alphabet (GOOGL) late Tuesday, Meta Platforms (META) released numbers that breezed past analyst estimates late Wednesday. A return to sales growth, and better earnings due in part to layoffs and cost cuts, helped send Meta shares up 11% in early trading today.
Benchmark 10-year Treasury Note yields have fallen roughly half a percentage point from their recent peak at the beginning of March. At 3.45%, give or take, the message coming from the bond market is: We don’t think the economy can handle high rates for very long...so be careful Jay Powell.
Short-term interest rate traders are also a BIT less sure the Fed will hike at next week’s meeting. The probability of another 25-point hike (to a range of 5%-5.25%) slipped to 72% yesterday from 85% a week prior. Fed Funds futures markets are also pricing in a rising likelihood of rate CUTS starting in Q3 or Q4 of this year.
Please Note: There will be no MoneyShow Expert Interview Series video this week due to me hosting the Las Vegas conference. The feature will return next week.