Before The Bell
The U.S. stock market traded lower yesterday, as investors seemed to adopt a more cautious tone. However, it should also be noted that the third-quarter earnings season has largely winded down, and a pause here may be warranted. Overnight, the global markets have been putting in a divided showing. In Asia, the Nikkei managed to advance slightly. In Europe, the FTSE 100 has been mixed. On our shores, the equity futures are mixed, suggesting a neutral start to the day.
In economic news, the consumer will be the center of attention today. This morning, we get a look at the retail sales numbers for the month of October. In general, the consumer has remained upbeat in a challenging climate, and an improved economic outlook and the easing of pandemic-related restrictions should be a plus. Clearly, during the pandemic the e-commerce sector experienced a surge in popularity, and it will be interesting to see how many retailers have been adopting to this development. In addition, it remains to be seen if the inflationary environment, which seems to be quite persistent, will discourage shoppers. Also today, we get a look at the industrial production numbers for the month of October.
Tomorrow, the real estate market will be in focus. Specifically, housing starts and building permits for the month of October will be released. This issuance should receive some attention, given that the real estate market is an important part of the broader economy. Demand for housing has remained relatively strong, so far. However, concerns about a possibly higher interest rates may put a damper on this key sector.
In the corporate arena, a number of retailers are set to report their results this week. This morning, we heard from Walmart (WMT), which is a one of the biggest companies in the sector. At first glance, that report looked constructive, and the stock is trading slightly higher pre-market trading. Tomorrow, TJX Companies (TJX) and Target (TGT) will weigh in with their numbers.
Technically, the stock market advanced sharply during the month of October and during the first part of November. The S&P 500 Index seems to have hit some resistance at the 4,700 mark a few days ago, and has since pulled back slightly. It remains to be seen if this development will lead to a more pronounced consolidation, or if the bulls will quickly step in to push stocks higher from here.
– Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
