Economic Journal - Thursday, 12/31/2015

(as of 7:00 AM PST)

It looks like we are ringing out the old year with some pretty harsh economic data that leads us to carry worries into 2016.  Markets are down moderately to start the day, but it could be worse.  The Chicago PMI, a key measure of industrial activity plunged far below expectations and into contractionary territory, at a level not seen since 2009.  Jobless claims were up and higher than expectations which indicates that the nascent economic recovery we experienced this year might be more fragile than we think. It's hard to imagine that the Federal Reserve interest rate hike is having an impact so soon, but this definite negative turn is likely to slow future rate hikes and might, if troubles continue to arise, cause a reversal back to zero or even negative rates in 2016. There are few traders on this last day of 2015, so any major impact on prices might carry over to Monday's opening session.  It has certainly been a blah year from a market perspective.  Technology and pharmaceuticals are about the only sectors that had a good year, while international markets and commodities in general were the worst performers.  Our hope is that today's reports are anomalies, and that the New Year will usher in a continuing vibrant US economic recovery, and that the strength of our economy will jumpstart the rest of the global economy in 2016.  Whatever the case, we at Miller Financial Group want to wish you all a healthy and prosperous New Year!  

Economic Journal - Wednesday, 12/30/2015

(As of 7:15 am PST)

Coming off of a stellar day yesterday which saw both the Dow and S&P500 push toward positive numbers for the year, the markets opened trading this morning by giving back some of those gains. Once again the culprit in this thinly traded holiday week is oil. After rebounding yesterday, oil is reeling today following an American Petroleum Institute estimate late Tuesday that there was an increase in supplies last week. Adding to the downward pressure on oil prices today was a statement from Saudi Arabian’s oil minister “that the country no longer limits oil production and stands ready to meet any rise in demand for crude.” Without a lot of other economic news scheduled to be reported today and tomorrow, oil will dominate investors thought process as we head into the final two trading days of 2015. There are a couple of reports due out later this morning that could move the needle. The first is the Pending Home Sales report followed by a report on Crude Inventories. Don’t expect either of those reports to reverse today’s downward trend.

Economic Journal - Tuesday, 12/29/2015

(As of 7:25 AM PST)

 

What a difference a day makes! Stocks are up sharply this morning following the lead of strong foreign equity markets overnight and rebounding oil prices. All of the major European indices ended in the positive as did the Asian markets and oil is up over 2% in early trading. The final trading days of 2015 will determine where the markets end up for the year. After the close on Monday, the Dow was down 1.7% year to date and the S&P500 was nearly break even. Movement like we are seeing today could move both indices into positive territory for the year. It’s a short week with the holiday on Friday and economic data is light, so oil continues to be the major market mover. There was some good news from the light economic calendar already this morning. Home prices rose for the three-month period ending in October which was stronger than in September and consumer confidence rose in December. Maybe Santa is going to show up after all.

Economic Journal - Monday, 12/28/2015

(As of 7:00 AM PST)

 

As we kick off another holiday shortened week, the markets aren’t showing any signs of being in the holiday spirit. In early trading this morning, all of the major indices have opened in negative territory. Oil continues to be the drag on the market and after a rally toward the end of last week, it has opened today down over 2%. With a light week of economic news due out, oil will more than likely be the major market mover. International news isn’t providing much cause for celebration either with disappointing economic data out of both China and Japan. Industrial profits in China were down 1.4% year-over-year which was the sixth straight month of decline. While in Japan, industrial production and household spending declined 1% and almost 3% respectively, month-over-month in November. Without any other market moving news out there other than the over supply problem with oil, the Santa Claus rally may have a hard time finding any traction as we close out 2015.