Were Tariff Fears Exaggerated? (No. Two Reasons Why)
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What’s in Today’s Report:
- Were Tariff Fears Exaggerated? (No. Two Reasons Why)
Futures are slightly lower following a major central bank rate hike and despite better-than-expected economic data.
The Bank of Japan raised interest rates 25 bps, as expected, and signaled further rate hikes are coming (also as expected).
Economically, Euro Zone and UK Manufacturing PMIs slightly beat estimates but both remained in contraction territory.
Today we get the most important economic reports of the week via the January Flash Manufacturing PMI (E: 48.9) and Flash Services PMI (E: 56.7) and again, markets will want to see in-line to slightly soft data. Stronger than expected readings would likely boost yields and pressure stocks. Other economic reports today include Existing Home Sales (E: 4.16 million) and Consumer Sentiment (E: 73.2).
Turning to earnings, the key report I’m watching today is AXP ($3.03) as that will give us insight into consumer spending and the stronger the report, the better.
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