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Market Rap 06/16/22 by CTG

SPY / QQQ / Vix

SPY 5 days, hourly candles S&P futures giving it all back overnight, breaking yesterday/Monday lows 369.44 the corresponding futures/pre mkt low

382.86 the corresponding futures high

SPY 3 months, daily candles Yesterdays post FOMC reaction saw the daily bounce get going, but has already been reversed in futures action with a loss of Monday's low. Daily bear flag is set to play thru if it can't quickly reverse. (support)

370.59 Monday's low, trading just under there currently

368.27 the weekly low from 1/25/21

364.82 the weekly low from 1/4/21

362.03 from 12/24/20 (resistance)

383.90 the high from yesterday and first resistance on this timeframe

QQQ 5 days, hourly candles Nasdaq futures broke under yesterdays low; slightly different look than the S&P though, as we're testing/still above Monday's low 274.15 the corresponding futures/pre mkt low

286.30 the corresponding futures high

QQQ 3 months, daily candles Pushed into the gap created Monday as the daily bounce got underway post-FOMC, but failed to fill it; daily bear flag potential here as well if we can't hold above those Monday lows (support)

273.34 the low from Monday

266.97 the weekly low from 11/2/20

260.11 the weekly low from 9/21/20 (resistance)

286.83 the high from yesterday and first resistance on this timeframe

TLT 5 days, hourly candles and 15years, monthly candles Losing Monday's lows already here, as bond markets around the world continue in crash mode. Now trading at levels last seen in Q1 of 2014

July Vix futures 3 months, daily candles Yesterdays big vol crush being reversed today, but still an inside bar so far within yesterdays wide range

Spot Vix 3 months, daily candles Yesterdays post-FOMC vol crush here being reversed as well, but also still within yesterdays big range. Back above 30 so helmets on for more big moves, both directions

The S&P 500 futures are down 91 points and are trading 2.5% below fair value. The Nasdaq 100 futures are down 309 points and are trading 2.9% below fair value. The Dow Jones Industrial Average futures are down 607 points and are trading 1.9% below fair value. Once again, there has been a quick inclination to sell into strength as the reality hits home that inflation, weaker growth, and central bank rate hikes are not just a U.S. problem. They are effectively a global problem (well, not rate hikes in Japan or China, but just about everywhere else). The stark reality of a hawkish central bank pivot has been perpetuated by the Fed's largest rate hike (75 bps) yesterday in 28 years, a surprise 50-basis point rate hike by the Swiss National Bank today, a 50-basis point rate hike by Brazil's central bank, and the Bank of England (BOE) following course with a 25-basis point rate hike this morning. Coupled with the rate hikes -- and partly because of them -- are forecasts for weaker growth and building anxiousness about a potential economic and profit recession. Relatedly, the BOE thinks Q2 GDP will fall by 0.3% as a whole, and the Atlanta Fed's GDPNow model is expecting Q2 real GDP to be flat versus a prior forecast of 0.9% growth. There is a stagflation buzz in the air and it isn't good. Sovereign bond yields are rising again today and most global equity markets are/were lower. The 2-yr note yield is up 11 bps to 3.38%. The 10-yr note yield is up seven bps to 3.47%. WTI crude futures are down 1.9% to $113.17/bbl while natural gas futures are up 5.2% to $7.81/mmbtu. In corporate news:

  • Tesla (TSLA 667.69, -31.31, -4.5%): Reuters reports that company has raised its prices across its entire vehicle lineup

  • Commercial Metals Company (CMC 37.68, +0.41, +1.1%): beats by $0.76, beats on revs; says robust demand for each of CMC's major product lines is expected to persist, augmented by growing downstream backlog and solid levels of new work entering the project pipeline.

  • KLA-Tencor (KLAC 319.15, -4.64, -1.4%): reaffirms Q4 guidance; announces $6 bln share repurchase program and dividend raise at Investor Day

US May Housing Starts -14.4% To 1.549M; Consensus -2.6%Building Permits -7.0% To 1.695M Rate In May

Philadelphia Fed Jun Business Index -3.3 Vs May 2.6

US Jobless Claims -3K To 229K In Jun-11 Wk; Survey 220K

US Jun-4 Week Continuing Claims +3K to 1,312,000

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