The Day Ahead, Friday October 26th

Friday features two major economic releases as Q3 GDP is due out along with the October release of the University of Michigan Consumer Sentiment. It is a quiet day in terms of earnings, but the effects of Google and Amazon’s disappointments will be felt. Although finding a sustainable bottom before the next leg higher is very difficult, our favorite indicator is likely to close the week at the most oversold level since the two swoons in February and November 2016.  Again, it doesn’t mean the market can’t get worse in the very near-term, but the current level of oversold does suggest any further weakness should be made up over coming weeks and months.

1. Q3 GDP Release – At 8:30 A.M. EDT, the initial release of 3rd quarter GDP is due out. Current consensus expectations are for GDP growth of 3.4%, compared to a final Q2 number of 4.2%. Personal Consumption is expected at 3.2% for Q3, compared to 3.8% in Q2, while Core PCE on a quarter-over-quarter basis is expected to be 1.6%, compared to 2.1% in Q2.
2. University of Michigan Consumer Sentiment Release – At 10:00 A.M. EDT, University of Michigan Consumer Sentiment for the month of October is due out, with current expectations for no change from the previous month at 99.0.
3. Key Earnings Releases:
   1. Colgate-Palmolive Co (Ticker: CL) – Consensus EPS: $0.72
   2. Goodyear Tire & Rubber Co (Ticker: GT) – Consensus EPS: $0.75
   3. Phillips 66 (Ticker: PSX) – Consensus EPS: $2.48

Past performance is not a guarantee of future results. All market data points and expectations are from Bloomberg as of 10/25/2018, and should not be relied upon as current thereafter. All earnings estimates are from Fidelity as of 10/25/2018 and should not be relied upon as current thereafter.