All was quiet on the Wall Street front. The S&P 500 slipped 0.33% to break its six week winning streak, as reasonably good consumer reports offset modestly negative trade headlines. During that winning streak the market exhibited a remarkable absence of volatility, inching up approximately 1% a week, for a total gain of slightly less than 6%.
On the consumer front, October retail sales bounced back 0.3% after declining a similar amount in September, and the University of Michigan Sentiment Survey also showed a nice increase. Interestingly it was the gauge of future expectations that climbed while current conditions decreased slightly. The latter indicator is worthy of attention as it is much more volatile, and a steep downturn can be a canary in the coal mine in predicting a recession. To be clear, this most recent reading is still very high and not alarming at all.
The outlook for a trade deal with China remained murky, as the 2019 Hong Kong Human Rights and Democracy Act reached President Trump’s desk. Should it become law, Washington could eventually withdraw Hong Kong’s special trade status if it finds that Beijing isn’t maintaining the city’s unique freedoms, an action which would infuriate China. Trump has been vague about whether he would sign or veto the legislation to back protesters in Hong Kong. December 15 is approaching quickly, at which time a new round of tariffs is scheduled to be implemented unless a “phase one” trade agreement can be reached. On Friday President Trump said he was “very close” to a trade pact, providing some optimism for traders to help them enjoy their weekend.
The yield on the Ten-Year Treasury edged down 6 basis points to 1.77%, while the dollar and gold were both steady.
The Chicago Bears eked by the lowly New York Giants. Our playoff hopes are still alive!
On the consumer front, October retail sales bounced back 0.3% after declining a similar amount in September, and the University of Michigan Sentiment Survey also showed a nice increase. Interestingly it was the gauge of future expectations that climbed while current conditions decreased slightly. The latter indicator is worthy of attention as it is much more volatile, and a steep downturn can be a canary in the coal mine in predicting a recession. To be clear, this most recent reading is still very high and not alarming at all.
The outlook for a trade deal with China remained murky, as the 2019 Hong Kong Human Rights and Democracy Act reached President Trump’s desk. Should it become law, Washington could eventually withdraw Hong Kong’s special trade status if it finds that Beijing isn’t maintaining the city’s unique freedoms, an action which would infuriate China. Trump has been vague about whether he would sign or veto the legislation to back protesters in Hong Kong. December 15 is approaching quickly, at which time a new round of tariffs is scheduled to be implemented unless a “phase one” trade agreement can be reached. On Friday President Trump said he was “very close” to a trade pact, providing some optimism for traders to help them enjoy their weekend.
The yield on the Ten-Year Treasury edged down 6 basis points to 1.77%, while the dollar and gold were both steady.
The Chicago Bears eked by the lowly New York Giants. Our playoff hopes are still alive!