It’s another ugly day for global equity markets, with S&P 500 futures down another 37 points (-1.3%) following yesterday 43 bps decline. Not surprisingly, the negative performance in risk markets is sparking a bid for Treasuries today, pushing yields 4-8 bps lower across the curve. There doesn’t seem to be any one catalyst for today’s action, but investor confidence is likely waning due to the myriad of headwinds for a myriad of factors that have lingered in recent weeks/months. These headwinds include ongoing U.S./China trade tensions, hawkish Fed policy, higher Treasury yields, Italian budget concerns, geopolitics (e.g., Saudi Arabia), and speculation that U.S. corporate earnings growth may have finally peaked. The S&P 500 is poised to post its 12th loss in the last 14 days. Most of the macro headwinds won’t likely subside anytime soon, so the necessary catalyst for a turnaround for stocks would be better Q3 earnings reports relative to what we’ve seen over the last week. The economic data calendar for today is limited, but we will hear from four regional Federal Reserve Bank presidents (Kashkari, Bostic, Kaplan, and George).

Jason Haley
Managing Director, Investment Management Group


10/22Chicago Fed Nat Activity Index0.210.170.18
10/23Richmond Fed Manufact. Index2429
10/24MBA Mortgage Applications-7.10%
10/24FHFA House Price Index MoM0.30%0.20%
10/24Markit US Manufacturing PMI55.355.6
10/24Markit US Services PMI5453.5
10/24Markit US Composite PMI53.9
10/24New Home Sales625k629k
10/24New Home Sales MoM-0.60%3.50%
10/24U.S. Federal Reserve Releases Beige Book
10/25Advance Goods Trade Balance-$75.1b-$75.8b
10/25Wholesale Inventories MoM0.50%1.00%
10/25Retail Inventories MoM0.70%
10/25Durable Goods Orders-1.50%4.40%
10/25Durables Ex Transportation0.40%0.00%
10/25Cap Goods Orders Nondef Ex Air0.50%-0.90%
10/25Cap Goods Ship Nondef Ex Air0.40%-0.20%
10/25Initial Jobless Claims214k210k
10/25Continuing Claims1647k1640k
10/25Bloomberg Consumer Comfort60.8
10/25Pending Home Sales MoM0.00%-1.80%
10/25Pending Home Sales NSA YoY-1.90%-2.50%
10/25Kansas City Fed Manf. Activity1413
10/26GDP Annualized QoQ3.40%4.20%
10/26Personal Consumption3.30%3.80%
10/26GDP Price Index2.10%3.00%
10/26Core PCE QoQ1.80%2.10%
10/26U. of Mich. Sentiment9999
10/26U. of Mich. Current Conditions114.4
10/26U. of Mich. Expectations89.1
10/26U. of Mich. 1 Yr Inflation2.80%
10/26U. of Mich. 5-10 Yr Inflation2.30%