Good Morning. Earnings season kicks into high gear this morning with JPM and WFC announcing before the bell. Expect the traditional beat based on debt revaluation and reversal of loan loss provisions. Yes, the cheaper your debt trades, the more you can book as a profit. Hopefully the street will see beyond the headline number and question the quality of the “earnings.” The wonders of accounting will never cease to amaze me.
What also does not amaze me is how the DOL will report a very important data point in weekly claims, knowing it is missing a state and not at least estimate the value for that state. An estimate and an asterisk. Is that too much to ask for?
Back to markets, things are getting very interesting. We have all indices triggered short with tech and the Russell showing downside leadership. The only “wrench” being the currencies are in somewhat muted territory. Though AUD and EUR are both triggered short, momentum is waning a bit. Yet EUR/AUD, the risk off currency is looking bullish and signaling more downside in risk assets.