Update on U.S./Iran Risks
What’s in Today’s Report:
- Geo-Political Update: Was There More Negative News Over the Weekend?
- The Two Reasons Markets Remain Resilient
- Weekly Market Preview
- Weekly Economic Cheat Sheet (Jobs Report Friday)
Futures are moderately lower on rising general concerns about the geo-political fallout from the Soleimani killing.
Geo-political headlines over the weekend were incrementally negative, but none of them were specific or material enough to imply a material drop in stocks is more likely, and the dip in futures is driven by just general concerns (more on that inside the Report).
Economic data, meanwhile, was positive as Dec. German Retail Sales, EU Services PMI (52.8 vs. (E) 52.4, and UK Services PMI (50.0 vs. (E ) 49.0) all beat estimates.
Today geo-political headlines will continue to dominate trading, and any implication of further deterioration in the U.S./Iran situation will weigh on futures. Economically, the key number to watch it the December Markit Services PMI (E: 52.2) and, as remains the case, the stronger the number, the better.
