US Economy and Credit Markets Ended June 28, 2019

As the Federal Reserve indicates there is potential for lower interest rates and China/US trade tensions run high, gold has spiked to a six-year high with prices above $1,400/oz. This comes as oil is also resting at almost $60/bbl after nearly sinking below $50/bbl mid-month. While the Federal Reserve has not cut rates in 2019, the 10-year treasury yield has fallen from over 3% in late 2018 to just above 2% at current. Further, based on market embedded expectations for the Federal Reserve, interest rates will be cut by a full percentage point in the coming year. While it is summer and next week will be shortened by Independence Day celebrations, markets will be anxious to see next week's Jobs data and June unemployment numbers. On Friday of last week, personal income was seen rising by half-a-percent in May which was ahead of expectations. For the past year, income has risen 4.1% but spending has increased 4.2%. Major economic reports (related consensus forecasts, prior data) for the upcoming holiday-shortened week include Monday: June final Markit US Manufacturing PMI (50.1, 50.1), June ISM Manufacturing (51, 52.1) and May MoM Construction Spending (0.1%, 0.0%); Wednesday:  June 28 MBA Mortgage Applications (N/A, 1.3%), June ADP Employment Change (140K, 27K), May Trade Balance (-$53.4B, -$50.8B), June 29 Initial Jobless Claims (220K, 227K), May Factory Orders (-0.5%, -0.8%) and May Final Durable Goods Orders (N/A, -1.3%); Friday: June Change in Nonfarm Payrolls (163K, 75K) and June Unemployment Rate (3.6%, 3.6%).
Posted on Monday, July 1, 2019 @ 7:56 AM

These posts were prepared by First Trust Advisors L. P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.