Caleb Lawrence – KPIG-KPYG Radio – Share the Wealth – February 10, 2017
The major averages enter the final hour with modest gains despite some disappointing data. Since Monday the Standard and Poors 500 Index has advanced 24 points or about 1% while the NASDAQ is up 83 points or 1.5%. It would appear that the Trump trade is it, never mind the data, valuations or much of anything else as nothing seems to matter anymore.
Import prices increased .4% in January a second consecutive large monthly gain, on a year ago basis import prices advanced 3.7% the fastest rate of increase since February of 2012. Food and consumer prices slipped again.
Factset reports that of the 71% of Standard and Poors 500 Companies reporting earnings so far, the 1st quarter is on track to produce 5% earnings growth and mark a second consecutive quarter of growth on a year ago basis, a feat last achieved in the first quarter of 2015. The beat rates stand at 67% for earnings and 52% for revenue.
In the week that was Trump saw his executive power checked as we still live in a democracy. That said tales of bizarre behavior continue to swirl along with a developing picture indicating a real lack of cohesion within the administration as we march further down the classic republican path of deficit spend, deregulate, and cut taxes to promote economic growth, never mind that the Laffer Curve has been shown to be a resounding failure.