Weekly Economic Summary - 9/17/2018Submitted by Miller Financial Group, LLC on September 17th, 2018
All of the major U.S. indices are struggling to find a direction in early trading this morning following a week that pushed U.S. stocks into near record levels. If the S&P500 can find a way to turn positive today it would mark the sixth straight positive session - the longest streak for the index since February. At the current levels, the S&P500 is 0.5% below its’ record high while both the Dow and the Nasdaq are within 2%. Last week, the Dow was up 0.9% marking the fourth positive week in the last five weeks.
Ongoing trade tensions between the U.S. and China seem to be providing the biggest headwind for investors. On Friday, President Trump gave orders to proceed with $200 billion in tariffs against Chinese products. This current round of tariffs adds to the billions of dollars of tariffs that have already been levied. China has threatened to forego the proposed meeting between senior officials to discuss trade matters if the new tariffs are enacted. Investors for the time being have chosen to shrug off trade concerns and focus on strong corporate profits and economic data.
There won’t be a lot of economic reports to move the needle this week. The lone report out this morning is the New York Fed’s Empire Manufacturing Survey for September. It was weaker than expected with a reading of 19 compared to the August reading of 25.6. Any number above zero indicates growth in manufacturing activity. The focus this week will be on the housing market beginning with the NAHB Housing Market Index for September which will be released tomorrow. A report on Housing Starts and Building Permits for August will be released on Wednesday while the Existing Home Sales report for August will come out Thursday. Housing data will be closely watched since rising interest rates are pushing mortgage rates higher.
In markets around the world, Asian stocks fell reflecting the trade pressures and a powerful typhoon in the region. Stocks in Europe are mostly in the red.
Our thoughts and prayers go out to those recovering from Hurricane Florence along the east coast.
Have a great week!