May 9, 2023

Markets:

Stock futures were under pressure Tuesday, with regional bank shares retreating, as investors readied for key inflation reports due later in the week.

PacWest shares fell more than 8% in the premarket after a volatile session in which the regional bank rose more than 3%. The SPDR S&P Regional Banking ETF (KRE) dipped 0.8%, as investors continued to fret over the state of the U.S. banking system.

Lucid, PayPal and Skyworks were all down after their quarterly reports were released. Meanwhile, Palantir jumped 20% on a strong earnings report and upbeat guidance.

Traders are also looking ahead to April’s consumer price index report slated for Wednesday and the producer price index on Thursday for the newest data on the path of inflation.

Elsewhere, Treasury Secretary Janet Yellen said on CNBC Monday afternoon that failing to raise the debt ceiling would be an “economic catastrophe” and that regulators are not close to any policies that would limit short-selling regional bank stocks.

Investors will watch Tuesday for morning data from the National Federation of Independent Business. Fed Governor Philip Jefferson and New York Fed President John Williams are both slated to speak at events over the course of the day.

Portfolio:

We enter the new trading session holding positions in S, TSLL, and EDR. Portfolio looks good and queue remains active. As we stated yesterday, really excited to see the potential for this market after all inflation data is received this week. We would love to see 4200 tested and broken. Pain trade, to us, remains higher. This market could get absolutely explosive should we dare cross 4350 on the S&P. 3890 on the downside is the line for the Bears. We will continue to remind our community of this to help with your trading plans. We remain in range. Be on alert, stay patient, especially where we are right now, and let's continue to find opportunity.