December 22, 2022

GDP Made The Traders Flee

This morning’s release of the government’s third estimate of GDP is not usually a major event… but it was today. 😲

The final Q3 GDP was revised higher to 3.2% from the previous 2.9%. Analysts have historically considered this a neutral to bullish reading, but this time was different.

With the labor market still strong/not retreating and revised higher GDP numbers for Q3, the fear that the Federal Reserve will keep ticking rates up is very real.

Despite the upcoming holiday break, next week will undoubtedly be another anxiety-filled time for investors with December consumer confidence results, November pending home sales, and Chicago PMI numbers coming in. 😯

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January 5, 2024

Jobs Data Dampers Q1 Rate Cut Odds

While the leading indicators of employment continue to point to a slowdown, coincident indicators like U.S. nonfarm payrolls and ADP employment data continue to surprise to the upside. For stock market bulls, that may be bad news as it takes hopes of a first-quarter rate cut off the table. 😞

As we’ve discussed, much of the market’s recent rally has come on the back of hopes that the Federal Reserve will cut rates as much as six times in 2024. Disinflation continues across most major metrics, but a tight labor market has kept consumers spending and the economy humming along. As a result, Jerome Powell and the Fed have been hesitant to loosen financial conditions too quickly.

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Economy

February 13, 2024

Fed’s Rate Cut Message Finally Heard

Inflation worries had all but disappeared recently. But as usual, the market likes to fool the majority, so we saw January’s consumer prices surprise to the upside today. 🫨

Headline CPI rose 0.3% MoM and 3.1% YoY, topping the 0.2% and 2.9% Wall Street had expected. Core consumer prices, which exclude food and energy prices, rose 0.4% MoM and 3.9% YoY. Shelter was again the largest component driving the increase, climbing 0.6% MoM and 6% YoY. 🔺

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Economy

September 18, 2023

A Divergence In Homebuilders

Today’s National Association of Home Builders/Wells Fargo Housing Market Index experienced its first negative reading in seven months. 🔻

The index dropped 5 points to 45 in September, with all three components declining. Current sales conditions slipped to 51, sales expectations in the next six months fell to 49, and buyer traffic dropped to 30.

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Economy

December 13, 2023

Powell Doesn’t Want Coal Again This Year

Looks like Powell wants to be put on Santa’s nice list before the end of 2023. ✅

After the decision came out this afternoon that rates wouldn’t change, Powell’s big kicker to traders and investors was the very dovish tone.

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GDP Made The Traders Flee

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