Weak Economic Reports Almost Catalyzes The First 5% Correction Of 2019
Weak Economic Reports - Another Down Day There are several Weak Economic Reports that almost seem to be leading towards a correction. Thursday was another down day. S&P 500 fell 1.19%, Nasdaq fell 1.58%, and Russell 2000 fell 1.97%. The market is now at the low end of its recent range. There still hasn’t been a…
Economic Slowdown Signaled By Disastrous Flash May PMI Reading
Economic Slowdown - Jobless Claims Stay Low Before getting into the seemingly imminent Economic Slowdown, let's discuss the jobless claims. In the week of May 18th, jobless claims fell 1,000 to 211,000. As you can see from the chart below, the past couple jobless claims reports have settled in between the spike in late April and the trough…
Tesla Stock Craters 6%
Tesla Stock Craters - Stocks Fall Again Tesla Stock Craters and S&P 500 fell 0.28% on Wednesday. This supports my thesis that the market won’t hit a new record high until economic data improves or the odds of a trade deal improve. A more specific way of saying this is I don’t expect stocks to…
Homeownership Rate 23 Points Lower For Millennials
Homeownership Rate - Relatively Poor MBA Applications Before getting into the Homeownership Rate, let's review the MBA Appplications. MBA applications index in the week of May 17th increased 2.4% weekly which was up from the 0.6% decline last week. Unfortunately, this strength was all about the refinance index. It increased 8% after falling 1% last week.…
Stocks Rally Despite Lack Of Progress On Trade War
Stocks Rally - President Trump Lifts Tariffs On Canada & Mexico Before getting into what caused the stocks rally, let's review what's going on in the trade war. In a tweet on Sunday, President Trump stated he would be lifting the steel and aluminum tariffs of 25% and 10% on Canada and Mexico. In turn,…
Tariffs Hurt Retail Sales & Existing Home Sales Miss Estimates
Tariffs Hurt Retail Sales - Redbook Sales Growth Falls Before getting into how tariffs hurt retail sales, let's review Redbook. Every Redbook same store sales growth report is interesting for a different reason. Latest result is interesting because it includes how the consumer reacted to new tariffs being announced. Most consumers aren’t experts on tariffs, but…
Semiconductors Hurt by Trade War
Semiconductors - Trade War Worries Continue Semiconductors -The tech sector underperformed on Monday because of the fallout from the Commerce Department putting Huawei on its entity list. That prevents Huawei from buying American made parts and components. Blacklisting Huawei will have such a severe impact on American firms. Therefore, the government is trying to scale this…
U.S. Economy Inching Closer To A Recession?
U.S. Economy - What Caused The Consumer’s Uncertainty? U.S. Economy and Consumer Uncertainty reach an impasse. Preliminary May consumer sentiment reading and the expectations index hit a 15 year high. Both will likely come down when the final reading is released because of the newly implemented tariffs. The chart below reviews why consumer spending fell earlier…
Trade Fears - Standoffish China Sends Stocks Lower
Trade Fears - Stocks Decline Friday Trade Fears - The stock market had no business increasing on Friday since the latest news on trade is China isn’t ready to negotiate with America. That’s not a big surprise because they wanted to change what was already agreed upon and Trump held firm. Stalled trade talks are…
Leading Indicators Aren’t Optimistic
Leading Indicators - ECRI Leading Growth Falls Leading Indicators - This Friday was the one time per month we get an update on both the ECRI leading index and the Conference Board leading index. To be clear, the ECRI leading index is weekly and the Conference Board index comes out with data on the prior…