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Positive Earnings Trend Shows The Market Is Bullish

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In his Daily Market Notes report to investors, Louis Navellier wrote:

Rinse & Repeat

A repeat of yesterday: Inflation data soft, the market jumps.

PPI came in below estimates with the Core PPI y-o-y rate of 2.4% the lowest since Jan ’21. At the same time, jobless claims came in below estimates. Interest rates continue to fall as the conclusion that July will be the last Fed increase becomes the consensus. The 2yr US Treasury is down another 9bps, the 10yr another 6bps.

More importantly, the US dollar index has fallen below 100, very good news for international earnings. Gold is higher, crude oil is higher, and commodities in general are having a good run. High-yield bonds are back near the high of the year. The pricey megatechs are having another strong day. Both The S&P and NASDAQ are at the highs for the year.

China Struggles

This is despite the report that China‘s exports plunged 12.4% y-o-y in June, following a 7.5% decline in May. Imports declined 6.8% following May’s 4.5% fall. That the world’s 2nd largest economy can be struggling so much while the US stock market soars is a bit counterintuitive, but also gives a future tailwind to look forward to when China stages a recovery.

Positive Earnings 

Early earnings are positive with Delta Air Lines (NYSE:DAL) posting beats top and bottom, with the stock up 1% on the day and +48% YTD. PepsiCo (NASDAQ:PEP) also had beats top and bottom, up 0.5% this morning, + 2.6% YTD. Tomorrow before the opening we’ll get JP Morgan (NYSE:JPM), Citigroup (NYSE:C), Wells Fargo (NYSE:WFC), BlackRock (NYSE:BLK), and UnitedHealth (NYSE:UNH).

The trends remain positive and it’s a challenge to see what might derail the clearly bullish market.

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Louis Navellier

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