Good Morning on this fantastic Monday and after a wonderful Thanksgiving,
Bonds are taking a hit despite today’s news being extremely bond friendly with the ISM Manufacturing index down again and construction spending way down. Both were forecast to be higher. The Institute for Supply Management Manufacturing data showed an unexpected decline to 48.10 from 48.30, due to corporate investment cutbacks and continued tensions between the US and China. ISM is in recession territory and that construction spending is one of the best forward looking indicators for where GDP is heading. All this said, Bonds started the day down as yields in Germany, the UK, and Japan have improved. Now that the European markets have closed, we will see what kind of performance US bonds can put in for the rest of the session. The news today has not escaped equity markets which are selling off with the Dow down over 200+ points. We should see a bond rally.
Mr. Trump announced this morning that he plans to reinstate tariffs on steel and aluminum imports from Brazil and Argentina, effective immediately. I am not sure either of those countries will really care.
And, the impeachment inquiry continues as the House Judiciary Committee is scheduled to hold its first hearing on Wednesday at 7:00 AM (PT). House Judiciary Chairman, Jerrold Nadler, issued a letter informing the White House that both Trump and his legal counsel will be authorized to attend the hearings, and will allow Trump’s legal counsel to question the witness panel.
Make today great!