(As of 7:25 am PST)
Markets hit a bit of a speed bump this morning after
etching new record highs last week. A
Wall Street Journal article released Friday spooked investors, suggesting that
Fed officials have mapped out a plan to exit the central bank’s $85 billion per
month bond buying program. It shouldn’t come as a surprise that the Fed is
preparing its exit strategy; however the article has caused investors to fear
it may be sooner rather than later.
Analysts don’t expect liquidity to dry up anytime soon, citing the Fed’s
key economic indicators, the unemployment rate and inflation, as targets that
appear to be a long way off. Equity
selling was cooled after a positive report on retail sales showed sales rose
0.1% in April, exceeding expectations.
Internationally, most Asian markets finished the day lower, with Japan
bucking the trend on a continued weakening of the yen. European stocks are trending lower. Commodities are lower and the US dollar is
higher on the Fed rumor. It’s a “data-rich”
week with reports on retail sales, CPI, industrial production, manufacturing,
housing, and consumer sentiment giving investors plenty to chew on as earnings
season winds down.
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