Seems like we are always waiting on some type of economic news—today it is the producer price index (PPI) which is expected to be slightly negative for December–as always a significant deviation could move markets sharply.
We also have retail sales today which has become somewhat important recently as everyone scans the horizon for signs of a slowing economy–this is also forecast to be negative – by 1%.
Right now equity futures are up a very small amount—1/3% on the S&P500 as we await news. Interest rates are at 3.46% on the 10 year treasury which is off 6-7 basis points from yesterday. Of course we all knows this can change instantly.
Yesterday the rally in income issues continued–in a very small way. Since I am out of the office I am not contemplating any type of buying or selling–maybe next week.
After a relatively quiet day yesterday equity futures are just slightly green this morning. Interest rates are off 4 basis points or so at 3.46%
Brian Westbury and co said the ppi was ‘ugly’. He’s really negative on equity valuations
As of noon eastern, inversion between the 3M T and 10Y T widened 19 points. Good for floaters and near term F/F’s?
Bond traders sure loved PPI and retail news today.
Yes but why did the equity markets not like the PPI news? The news would imply that we are reaching peak interest rates and that the fed should start to back off. That should be good news for bonds and equities too. Maybe everyone is jumping back into bonds (I.e, transferring money from equities to bonds).