Friends
The market had a lot of headwinds to deal with today. First of all, two major banks reported what was eventually interpreted as slightly disappointing earnings. Then, on the economic front, the retail sales number was not good. The PPI number was benign, but the Fed and the markets would actually like to see a little inflation about now. The dreaded “deflation” word has slipped back into the lexicon this week. Finally, the consumer sentiment number was weaker than expected indicating that the plethora of deflating news recently is weighing on the consumer.
How did the markets react to all of this? Well, stocks sold off in early trading with the Dow Jones Industrial Average falling more than 60 points, but as we’ve seen lately, it’s hard to keep this market down. By the close the Dow was virtually flat to finish the day at 14,865. The S&P 500 was down 4 points to close at 1588. Gold was absolutely crushed as the yellow metal was down a whopping $80 to trade at $1484 per ounce, while oil was down $2.49 to continue its slide and finish the day at $91.02 per barrel WTI. Gold and other commodities were a big part of the story today, as they continued to show weakness thus spurring the deflation talk.
Earnings season will be in full force next week, so we’ll buckle up and watch the proceedings, particularly interested to see if the recent rise in share prices will be seen as an accurate assessment of corporate activity. We’ll keep you informed.
Have a great weekend everyone and enjoy the Masters. Who you got?
