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Solid Index Performance Belies Churn Below the Surface

EQUITIES
  • The on-off theme of the reflation trade was again present on Tuesday, with tech names seeing solid gains at the expense of energy, materials and financials. The mixed performance below the surface belied the strength in index prices, with the S&P 500 cresting at a new alltime high. For the e-mini S&P, the new high watermark at 4383.75 raises focus on the next psychological level at 4400.
  • Earnings season got off to a poor start, with JPMorgan and Goldman Sachs both trading lower following their respective earnings reports, which saw trading revenue miss expectations at both firms.
  • In Europe, most indices traded flat, with the DAX, CAC-40 and FTSE-100 all closing within 1 point of the opening price. Spain's IBEX-35 was the standout, slipping near 1.5% on the back of poor trade in Spanish banks.
  • Reports continue Wednesday, with Bank of America, BlackRock, Citi and Wells Fargo all due to announce.

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