Which Sectors Benefit From Trump’s Policies

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What’s in Today’s Report:

  • Government Shutdown Update
  • Which Sectors Benefit From Trump’s Policies
  • “Short-Volatility Trade” Update: Chart

Futures are little changed this morning as investors digest a hotter than expected inflation print out of Japan and still cautious gauge of consumer sentiment in Europe ahead of a busy day of economic data in the U.S.

Overnight, Japanese Core CPI fell to 3.5% vs. (E) 3.3% while the German GfK Consumer Climate Index edged up by a modest 0.7 points to -29.0 vs. (E) -29.6. Neither release was particularly positive for markets but futures are stable ahead of today’s domestic data.

Looking into today’s session, there are four economic reports to watch this morning: Durable Goods Orders (E: -4.5%), Case-Shiller Home Price Index (E: 0.2%), FHFA House Price Index (E: 0.1%), Consumer Confidence (E: 115.0). Markets will want to see stability in the housing market data and easing but not collapsing growth and sentiment numbers in order for stocks to hold near the recently established record highs.

There are no Fed officials scheduled to speak today but there is a 7-Yr Treasury Note auction at 1:00 p.m. ET. Yesterday’s 2-Yr and 5-Yr Note auctions were weak, putting upward pressure on yields and if today’s 7-Yr auction is weak as well, expect the benchmark 10-Yr yield to test the critical 4.30% level which could weigh on equity markets.

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