Market Commentary for Week Ended 9/13/2019

Market Commentary for Week Ended 9/13/2019

by David Rasmussen on Sep 13, 2019

Equity markets continued to break out higher this week while bonds and other haven assets retreated.  The week was punctuated with positive US economic data and benign to slightly positive trade news.  We are within 1% of the all-time high of 3025 on the S&P 500 achieved on July 29th.  This may prove to be another line of resistance.   

Where we go from here will highly depend on the FOMC’s decision next Wednesday afternoon Sept. 18th.  They are widely expected to lower short-term interest rates by 0.25% from 2.00% to 1.75%. 

 

S&P 500 Index:

As you can see, the S&P 500 has had an impressive 6% rally from the low of 2847 reached on 8/23.

Meanwhile long-term bonds have sold off roughly 7% from the high on 8/28

Long-Term US Treasury ETF (TLT):

 

 

Economic Data Recap

Source: (www.econoday.com)

The two notable data points this week:

  1. Retail Sales:  The data came into the high level of the expected range with a month/month increase of 0.4%.  This is another indicator that despite the trade war and the slowing global economy the US consumer remains healthy.
  2. Inflation indicators: The Producer Price Index (PPI) and the Consumer Price Index (CPI) came in as expected this week.

Producer Price Index:

 Consumer Price Index: