Futures are up moderately following news of deals involving Comerica and AMD.

continued for members… (more…)

There’s no jobs data today – legitimate or otherwise. So, investors and Fed watchers are left to reflct on the trend that was already arguing against the US economy being the “envy of the world.”

Futures are flat ahead of the open.

continued for members… (more…)

While the parties retreat to their corners and refine their talking points, markets got off to a very strong start in Q4. At some point, someone will pay a political price for shutting down the government. But, both parties are betting they’ll prevail. And, for now, the algos are making hay.

Indices are happy to focus on AI and semis. And, past shutdowns have been non-events from an investment standpoint.  Our analysis of shutdowns over the past 25 years:

continued for members… (more…)

The federal government shut down last night, furloughing hundreds of thousands of employees and shuttering hundreds of programs and services.

Futures were off sharply overnight but have since recovered much of their losses.

continued for members… (more…)

Among the biggest threats a shutdown poses to markets is that economic data would dry up. So, the algos are having a very tough time deciding how the brinkmanship playing out in Washington will affect both the real economy as well as how the economy is perceived.

One thing for sure, the potential shutdown has eclipsed both tariffs and Jeffrey Epstein in the news, Maybe that’s the point.

continued for members… (more…)

The two sides seem bound and determined to stick to their guns this time, their positions entrenched and unyielding. This afternoon’s White House meeting to avert a shutdown seems mere window dressing.

Naturally, futures are higher.

continued for members… (more…)

Futures are up slightly ahead of the PCE report – the Fed’s preferred measure of inflation.As we like to remind everyone, important government-generated economic data all come with an asterisk ever since Trump abruptly fired the head of the BLS after an employment report he didn’t like. The chilling effect will no doubt affect many government employees responsible for generating economic data.

I have no idea re the politics or backbone quotient of BEA director Vipin Arora. But, he reports to Trump sycophant Howard Lutnick, so take these and all future data with a huge grain of salt.

continued for members… (more…)

You’d think the White House would realize that juicing economic data is counterproductive. But, it’s the same brain trust that calculated that massive tariffs wouldn’t punish consumers (or voters.)

Maybe they had hoped they could get the rate cuts they needed before the impact had really been felt and/or the economic data had been recognized as fallacious.  In any case, data which argues the economy is doing great sure doesn’t support the more dovish rate cut scenario floating around Wall Street.

Futures are down again this morning after durable goods and GDP prints far exceeded expectations and initial claims came in well below forecasts. This sets up a “damned if you do, damned if you don’t” scenario for tomorrow’s PCE print.

The equities overshoot is rapidly dissolving, driven largely by the bouncing DXY.

continued for members… (more…)

With markets so far ahead of themselves, particularly among the numerous unprofitable tech stocks which are reaching all-time highs, it’s notable that Jerome Powell finally weighed in.

“We do look at overall financial conditions, and we ask ourselves whether our policies are affecting financial conditions in a way that is what we’re trying to achieve, But you’re right, by many measures, for example, equity prices are fairly highly valued.”

When your goal is reducing inflation by another 100 bps in the midst of an inflation stoking tariff regime, excessive liquidity is not your friend. ES fell about 60 points before bouncing near the 1.272 Fib.

We imagine Powell & Co. has been thinking about financial conditions a lot. There’s very little in the economic data, aside from slumping employment, which suggests the Fed should be increasing liquidity.

A hot new home sales print ordered up by the White House would hurt more than help.

continued for members… (more…)

Futures are flat ahead of the open…

…as the ongoing vol smackdown continues to support equities.

continued for members… (more…)