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Pre-Markets Surge to Start the Week; Estee Lauder (EL) Beats

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Monday, August 19, 2019

We expect very few clues to influence investors, not just here in pre-market Monday, but for the entire week. Last week brought more economic data than we’d seen for weeks; now we’ve got a couple weeks longer until August reads in employment, etc. begin to hit the tape.

Major U.S. indexes are surging in today’s early session, continuing from last week’s climb up off the canvas following the worst trading day of the year on Wednesday — see Kevin Matras’ report this morning here for details. Dow and Nasdaq futures are up triple digits at this hour, with the Dow looking to open more than 300 points higher than Friday’s close.

About the biggest potential market-moving factor this week in the symposium at Jackson Hole, WY — this yearly retreat of Fed voting members to discuss rate policy going forward. Currently, the market expects another 25 basis-point rate cut at the Fed’s September meeting, which would bring the nominal rate below 2% for the first time in almost a year. Any language Fed Chair Jerome Powell uses to the positive or negative of this given could influence market trading in wither direction.

As we clean up earnings season this summer, beauty products major Estee Lauder (EL - Free Report) once again outperformed expectations. The Zacks Rank #3 (Hold)-rated company posted fiscal Q4 earnings of 64 cents per share on sales of $3.59 billion — easily surpassing the 53 cents per share expected (and two cents higher than the year-ago quarter) on revenues that came in 1.79% higher than the Zacks consensus. The company also raised full-year 2020 guidance.

Estee Lauder has not missed earnings estimates in any quarter for at least the past five years. The stock, which had grown 37.8% year to date — well ahead of the S&P 500 — is up another 6% in early trading today. About the only less-than-great comment to make is that the company did warn that a prolonged trade war between the U.S. and China may provide a negative impact to its numbers. For more on EL’s earnings, click here.

Mark Vickery
Senior Editor

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