Investors welcomed in the New Year with a shortened, albeit event-filled first week. Thursday's weaker-than-expected December ISM Manufacturing Index number raised questions about the strength of the United States economy. US Treasury note yields were down on the news, with the 10-year Treasury note yield and the 30-year Treasury note yield falling to their lowest since January of last year. On Friday, nonfarm payrolls rose 312,000 in December, crushing the consensus expected 184,000. Including revisions to October/November, nonfarm payrolls increased 370,000. The strong jobs data alleviated some concerns of a slowing economy. At the same time in Atlanta, Federal Reserve Chairman Jerome Powell softened his tone by saying policymakers "wouldn't hesitate to make a change" if needed and that the Federal Reserve is listening to the concerns of the market. Treasury yields surged on the news, with the 10-year Treasury note yield recording its biggest single-day gain since November of 2016. Major economic reports (related consensus forecasts, prior data) for the upcoming week include (Factory orders/durables data postponed by government shutdown): Monday: December ISM Non-Manufacturing Index (59.0, 60.7); Tuesday: November Trade Balance (-$54.0b, -$55.5b), November Preliminary Wholesale Inventories MoM (0.5%, 0.8%), November New Home Sales (568k, 544k), November Construction Spending MoM (0.2%, -0.1%), November Factory Orders (0.3%, -2.1%), November Final Durable Goods Orders (n/a, 0.8%); Wednesday: January 4 MBA Mortgage Applications (n/a, -8.5%); Thursday: January 5 Initial Jobless Claims (225k, 231k); Friday: December CPI MoM (-0.1%, 0.0%).
Posted on Monday, January 7, 2019 @ 8:06 AM
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