(Bloomberg) -- Stock futures are mixed, though the news overnight hasn’t been uplifting -- we’ve had reports of the White House planning $60 billion in China tariffs, a big economic miss (German ZEW falling to lowest level since 2016), and the Nasdaq is looking weaker again. FB is down 1% pre-market, after cratering 6.8% yesterday, as the Cambridge Analytica data breach crisis deepens and after NYT said the company’s Chief Security Officer is departing.
This comes after a volatile session where the VIX soared nearly 40% at one point to ~22, mega-cap tech sold off (NYFANG -2.9%) on spillover from Facebook, and every sector in the S&P 500 closed lower. Aside from the "quad witch" on Friday, yesterday’s volumes were the highest in two weeks. We may see more of the same today as investors assess the carnage in tech (noting ORCL down 8.5% on multiple downgrades post-earnings plus worries over EU digital taxation) and position ahead of tomorrow’s FOMC decision.
Bezos Struts While Facebook Bleeds
While the financial community was watching an internal crisis unfolding at Facebook, with a lot of market valuation lost in the process, Amazon CEO Jeff Bezos tweeted this: A picture of himself strutting in the sunshine with a robotic dog. For the record, AMZN is up 32% year-to-date vs FB -2.2% (now the only FAANG member in negative territory in 2018).
Boeing Back in the Limelight
The big news overnight was the story that Trump’s $60 billion China tariff plan may be unveiled Friday. This is double what senior aides reportedly proposed and at the high end of the recent rumored range of $30 billion to $60 billion, which doesn’t bode well for Boeing. The aerospace bellwether’s stock has been under pressure since Trump introduced the steel and aluminum tariffs (BA down 8.4% month-to-date vs S&P 500 flat) and became a proxy for the market on many sessions when trade war fears ruled the narrative.
Interestingly though, BA was the sole component of the Dow in the green yesterday as aerospace & defense majors caught a relief rally, thanks to a potential rotation given the bloodbath in the perennially strong tech sector. It was also aided by a BofAML report that said the recent weakness on trade war concerns is unwarranted - we’ll see how well that call holds up, as that same analyst even acknowledged that a sizeable portion of the unidentified orders in BA’s backlog likely came from China.
Tick-by Tick Guide to Today’s Actionable Event
- Today -- G-20 meets, Trump hosts Saudi Crown Prince, WTI Crude expiry
- Today -- Kerrisdale to release new report on "low quality biotech" stock
- 7:00am -- PLCE earnings
- 8:00am -- KEYW investor day
- 9:00am -- DPS investor event
- 9:05am -- CAT at BofaML industrials conference
- 10:40am -- Publicis investor day in London
- 11:00am -- ENTG analyst meeting
- 11:40am -- AGCO at BofaML conference
- 12:00pm -- KSS at Telsey consumer conference
- 2:05pm -- M at Telsey conference
- 4:00pm -- ELLI analyst day
- 4:15pm -- FDX earnings
- 4:30pm -- API oil inventory data
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