Inflation Forecasted To Rise Above Fed’s 2% Target
Inflation - Weak Services Push Composite Flash PMI Lower The flash September composite PMI from Markit was weak because the service sector missed estimates sharply. The composite PMI was 53.4 which missed estimates for 55 and the prior report of 55. This was below the lowest estimate of 53.8. This shows Markit is restarting its…
Stock Investors Are Showing Extreme Greed
Stock Investors - Slight Selloff On Friday The optimism about the trade war is way overdone. New tariffs make it more likely there will be an economic slowdown in late 2018 and early 2019. The stock market is also way overbought even after the mild decline on Friday. The Dow was the only index that…
Communication Services - New Sector Starts Monday
Communication Services - Strong Thursday Rally The stock market rallied strongly again Thursday as the S&P 500 increased 0.78%, the Nasdaq increased 0.98%, and the Russell 2000 was up 0.43%. As you can see from the chart below, the Dow was the last of the 4 major indexes to reach a new record after the…
Leading Indicators Record High & Strong Philly Fed Index
Leading Indicators - Record High The August Conference Board leading indicators were up 0.4% month over month which missed the consensus for 0.5% growth. The July Conference Board leading index was revised to show 0.7% growth instead of 0.6% growth. Even though the leading index is supposed to lead the economy, they are laggards in…
Hourly Earnings Growth Is Positive Again
Hourly Earnings Growth - Real Wage Growth Is Positive Again Inflation missed estimates as CPI fell from 2.9% year over year to 2.7%. Hourly earnings growth was 2.9% which was a cycle high. Therefore, it’s not surprising real wage growth switched from negative to positive in August. As you can see from the chart below,…
Fund Managers Are Bullish On American Stocks
Fund Managers - Bearish Emerging Markets, Bullish On America The Chinese economy seems in a tailspin. Fund managers surveyed by Merrill Lynch expect global growth to fall in the next 12 months. As you can see from the chart below, the September z-score on American stocks is the highest at 1.3. The recent sell off…
Trade War? Stocks Rally Sharply
Trade War Potentially Simmers Down It's shocking how the trade war situation worked out. The futures market looked weak on Monday night. It seemed inevitable that China would match the tariffs President Trump announced. However, that’s not what happened. China announced it would tax $60 billion worth of American goods between a 5% and 10%…
Consumer Sentiment - Highest Since March
Consumer Sentiment Strong The University of Michigan consumer sentiment report showed consumer sentiment was 100.8 in the preliminary September reading. This beat the average estimate for 97 and last month’s reading of 96.2. It also beat the highest estimate which was 99. This report showed the most optimism since March 2018. Other than that, this…
Amazon To Sell 8 New Alexa Powered Products
Amazon - Tech Leads Market Lower The FANG stocks are down 15% on average from their 52 week highs. Even though I have been saying Twitter and Facebook are buys for the long term, it’s fair to say I have been wrong as both have continued to fall. Twitter fell 4.18% and Facebook fell 1.07%.…
Industrial Production Growth Solid | Import & Export Prices Decline
Industrial Production Growth Is Solid Since industrial production is a hard data report, it will settle the score on whether manufacturing growth was strong. I was unsure of the situation in August because many soft data reports conflicted with each other. The final tally is manufacturing was solid, but not as amazing as the ISM…
Recent Comments