It was Bell and Nortel again
Doug Porter
The non-manufacturing ISM was strong across the board. There was only a modest drop in the prices paid index and most of the indices related to growth stayed quite strong -- taken together with the ISM factory report on Tuesday it suggests the U.S. Economy stayed quite solid in October.
growth strong economy
The low jobless rate, the steady upward creep in wage increases and the solid employment gain will all help convince the Bank of Canada it is on the right path by continuing to tighten policy.
gain path canada employment
The market is basically waiting for signs that the slowdown is for real or not, and if there is a slowdown, just how deep is it?
real deep market waiting signs
Some evidence has emerged that inflation is starting to pick up, and there's concern that the Fed's rate increases may not have been enough so far to keep that inflation contained,.. It suggests that we may see more aggressive rate hikes rather than the gradual baby steps we've seen.
starting concern baby evidence inflation
The bottom line is that as long as equities remain aloft, there is precious little outside of Fed tightening to cool growth,.. And that tightening may need to be much more aggressive than the market currently expects to bring (economic) growth closer to the Fed's comfort zone of around 3.5 percent.
growth comfort market precious cool closer
When the strategist at Goldman Sachs reduced her recommended weighting on equities it sent the market into the red right off the bat, and ended up lower pretty much across the board in Canada and the U.S.
market canada red pretty
Right now there's concern again reemerging in the market that the Fed (U.S. Federal Reserve) is going to become more aggressive
market concern
It was a similar story to what we saw in 1999 when it was dominated by a vary narrow group of stocks, Bell and Nortel, but outside of that there was quite a bit of weakness
weakness story
[March's report] didn't meet the markets' worst fears, and on those grounds I view it as somewhat bullish,.. I don't really see any discernable sign that job growth is slowing. The underlying trend is still extremely robust job growth, which will lead the Fed to raise rates again.
growth fears job worst sign view
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