Why Didn’t Powells’ Comments Cause A Rally?
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What’s in Today’s Report:
- Why Didn’t Powells’ Comments Cause A Rally?
Futures are modestly lower as global economic data pointed to slowing growth and falling inflation pressures.
German PPI declined more than expected (-0.2% vs. (E) 0.4%). While UK Retail Sales were weak (-0.9% vs. (E) -0.1%) pointing to slowing growth and lower inflation.
Politically, there remains no end in sight to Republicans’ efforts to elect a Speaker, as Jim Jordan is expected to seek a third round of voting (one he is likely to lose, again).
Today there are no economic reports but there are two Fed speakers, Harker (9:00 a.m. ET) and Mester (12:15 p.m. ET), although given Powell’s comments yesterday neither should move markets.
So, trading today will be dominated by politics, geopolitics and yields. Any progress on finding a Speaker of the House will be welcomed by market (regardless of whether it’s Jordan, McHenry or anyone else), any calming of tensions in the Middle East will similarly be welcomed by markets as would a decline in the 10-year yield. Meanwhile, the opposite of any of those will likely add more headwinds to stocks.
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