The Market Bull – January 25, 2019
The major averages close with large gains. The economic data today, new home sales for a second consecutive month and durable goods orders, is AWOL compliments off the government shutdown, something that gets a temporary reprieve after a last-minute deal arranged by our dysfunctional government. Of the missing reports 2 consecutive months with the very economically significant new home sales data during a period when the economy and real estate is clearly showing signs of softening is a grievous omission that carries with it the potential for a nasty surprise on the other side. Since Monday the Standard and Poors 500 Index gained 7 points or .25%, while the NASDAQ advanced 55 points or .78%.
While US manufacturing continues to perform well, the opposite is true of Europe, China and Japan who have all struggled with slowing exports of late.
The Euro Zone and Japan are both on the verge of a manufacturing contraction, Germany is already going backwards, as is China, the world’s fourth and second largest economies respectively. With a solution to the trade war with China continuing to prove elusive, collateral damage mounts not only with respect to the global economy and real estate but increasingly with the technology sector as well as the Chinese rethink their foreign investment plans in the face of a looming 25% tariff on almost all exports to the US scheduled to be applied March 31st when the 90-day stay of execution expires.
Standard and Poors 500 Index closed at: 2,664.76 up 22.43
NASDAQ finished the day: 7,164.86 up 91.40
Gold ended trading at: $1,302.00 up $22.20