Economic Journal - Friday, 6/17/2016

(as of 7:10 AM PST)

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Economic Journal - Wednesday, 6/15/2016

(as of 7:25 AM PST)

On the day that the Federal Open Market Committee concludes its two-day policy meeting, the markets are looking for reasons to push into positive territory and avoid a fourth consecutive session in the red. Most experts believe that because of May’s poor employment report and the concern over the upcoming Brexit vote that the FOMC will keep the fed funds rate unchanged. Investors will be very interested in what Fed Chairwoman Janet Yellen says about what the Fed will due in July and the balance of the year. The Brexit vote continues to dominate investor sentiment around the world and polling yesterday swung back to the “Remain” camp. This has pushed all of the European markets into the green. That vote takes place on June 23rd. Asia has pushed into positive territory as well. It has been a busy day of economic reporting and the data has been mixed. The weekly mortgage applications data showed a decline in applications while the Producer Price Index and Empire Manufacturing Survey were both stronger than expected. A report on crude inventories is due out later today which will more than likely impact oil which has fallen below the $50 per barrel level.

Economic Journal - Tuesday, 6/14/2016

(as of 6:45 AM PST)

It's a bit of a minefield for investors as they weigh global and economic events this morning. While the effects of the tragic terror attack in Orlando wane and thoughts of a Federal Reserve interest rate hike diminish, attention now shifts to the very likely prospect that British voters will vote to exit the European Union.  Several polls show that the vote to exit is solidly in the lead in a vote to be held on June 23rd.  A vote for a British exit or 'Brexit' as the event has become known would signal a shift from global cooperation to nationalism, a concept that is also being pushed by the 'Trump for President' agenda.  Despite the stream of concerns, the US economy continues to provide a strong positive force to the global economy with unemployment at very low levels and longer term corporate growth projections (4th quarter of 2016) looking very strong.  US markets continue to lag in what might be the fourth consecutive day of declines.  Oil is on the decline again, but worries about a supply glut are on the decline, with projected demand numbers increasing and turmoil inside of Nigeria putting a dent is global supplies.  Precious metals continue their upward trend with the price of gold approaching $1300 per ounce.  Don't be surprised to see markets turn to the upside as the day wears on as oil prices react positively to a recent uptick in the demand for oil and energy stocks lead the way.

Economic Journal - Monday, 6/13/2016

(As of 7:25am, PST)

After a weekend where we watched yet another horrific mass shooting take place in Orlando, investors are cautious this morning ahead of two key market moving events that will take place in the next couple of weeks. In early trading, the Dow is down 21 points and the S&P500 is nearly at breakeven. The big news this week is highlighted on Tuesday and Wednesday with central-bank meetings in the U.S. and Japan. Most experts expect that the Federal Reserve will leave interest rates unchanged due to recent weakness in several economic reports, however there will be interest in the Fed’s outlook for the balance of the year. The other event that investors are eyeing with great interest is in Europe where U.K. voters will decide if they will leave the European Union. Polling activity has grabbed a lot of attention as it continues to show uncertainty of the result. There isn’t any economic data out today but there has been some news on the corporate front. Microsoft announced that it will acquire LinkedIn in an all-cash deal valued at $26.2 billion. LinkedIn is currently trading up nearly 50% while Microsoft is down over 3%. Oil is has fallen below $50 per barrel while gold is up in the early going.

Economic Journal - Monday, 6/6/2016

( as of 7:00 AM PST)

Friday's bad jobs report is a distant memory and investors are once again bidding up stock prices to open the trading week.  It seems that the positive momentum is a result of the fact that an interest rate increase is off the table for this month.  Oil is up on supply worries due to supply line disruptions in Nigeria. Europe and Asia were mixed with little conviction on the buy or sell side.  Precious metals are up slightly in early trading. Markets are showing amazing resilience in light of negative data and a bearish bias by many analysts and investors.  

Economic Journal - Friday, 6/3/2016

(as of 7:10 AM PST)

Today's shocking jobs report sent the Dow down by triple digits and other indices are following.  New jobs created was a meager 38,000 while analysts had projected 160,000.  In addition, prior month projections for both April and May were revised downward significantly, indicating that the US recovery was not near as vibrant as previously thought.  Other woeful economic data included a decline in the ISM services number, although the reading did not show a slippage into contractionary territory, and an increase in the balance of payments deficit.  Most investment sectors are reacting to the overall dismal numbers.  The US dollar is falling heavily on currency markets, interest rate yields are falling while commodities are generally up across the board, with gold and silver sporting gains of over 2%, breaking their down cycle that we have seen over the past few weeks.  One positive nugget that investors might see in the weakness is that the Federal Reserve is much less likely to raise interest rates this month in light of the economic weakness.  But it will not likely stem the downward tide that we are seeing at the beginning of what could be a long day for market bulls.  

Economic Journal - Thursday, 6/2/2016

(As of 7:05am, PST)

It looks like we may be back to the trend of where oil goes, so go the markets. The markets are all down this morning following a slide in oil prices. All of this after a volatile day yesterday which saw the Dow slipping to a triple digit loss in the early going and closing the day slightly in the green. The oil slide today is due to an announcement by OPEC that there will be no change in crude output. Consequently, energy stocks are taking a beating in the early going. Investors will continue to have their eyes focused on oil as OPEC continues meeting through the rest of the week. The labor market continues to look strong with the ADP Employment Change report showing an increase in private sector jobs close to expectations and a revised number for April that was better than expected. Unemployment continues to improve and marked its 65^th straight week where initial claims have been below 300,000. These healthy labor reports are all in line with the Fed targets and point to interest rate increases as the year rolls on. All eyes will be on the nonfarm payroll reports which are due out Friday. In news around the world, the ECB left its key lending rates unchanged as expected. All of the European indices are in the red at the moment while results in Asia are mixed.