GDP Accelerates, But Still Below Expectations
The markets are mixed in early trading, with the Dow and S&P lower but the Nasdaq higher. Advance estimates on Q4 GDP came in at +2.8%, which is below consensus which was looking for +3.2% but still above last quarter's reading of only +1.8%. For those folks still calling for recession, GDP needs to either going to fall off a cliff or we are going to see some big revisions.
In other economic news, The Univ. Of Michigan consumer sentiment survey rose to 75.0 in January from 74.0 last month.
Earnings reports are being greeted with much cheer this morning. Despite a handful of better than expected reports, very few stocks are higher after reporting today. The few that are trading higher include: HON, EMN, and INVN.
But the list of disappointing reactions is larger and includes: RVBD, F, CVX, PG, SBUX, and MO.
The euro is higher this morning, and helping most commodities. Gold prices are up to $1732; oil prices are still above $100; and copper and silver prices are higher as well.
The 10-year yield has stopped dropping for the time being and found some support at the 1.93% level for a 2nd day. The VIX is fractionally higher to 18.75 and also looks to be bottoming.
Trading comment: I still think this overbought market appears a bit tired and in need of some sort of rest. If the market closes lower today it will be the first back-to-back down days since mid-December. That's a pretty long streak. What will be interesting will be to see how quickly dip buyers come in and look to get more invested on any market weakness. I suspect this first pullback won't gain much traction before rallying again.