What’s in Today’s Report:
- What’s Driving the Melt Up, And How Long Can It Last?
- Weekly Market Preview
- Weekly Economic Cheat Sheet – The Big Number of the Week Is Today
Futures are slightly higher thanks mostly to momentum from last week’s rally as the weekend was a quiet one.
On trade, the WSJ reported China has reduced additional tariffs on some goods, but this is all part of the existing phase one deal and it’s not an incremental positive.
Economic data was sparse overnight, and none of the numbers are moving markets.
Today we get the most important economic report of the week, New Orders for Non-Defense Capital Goods ex-Aircraft (E: 0.0%), which is a proxy for business spending – something that should start to rise now that we have a phase one trade deal. As has been the case, the stronger this number, the better for stocks.
Beyond today, this week would have been a quiet one even if there wasn’t a holiday, but it should be even more so as the economic calendar is very sparse. Geo-politically, North Korea could launch a missile or test a nuclear bomb this week, but while it might cause temporary volatility, that won’t derail this rally. So, as long as there are no negative trade surprises, the path of least resistance for stocks remains higher into year-end.