Durable goods orders up, producer prices dip. Headline durable goods orders rose for a third consecutive month in January, down from December’s upwardly revised 1.3% increase but significantly better than consensus estimates, which called for a 0.7% contraction. The core reading, which excludes nondefense and aircraft, also handily beat expectations and rebounded from a decline in December. The increase in orders comes amid moderating producer prices, which rose 0.1% in February, less than consensus expectations for a 0.2% increase despite rising oil prices.
Brexit deal voted down…again. With less than three weeks until the March 29 deadline, U.K. Prime Minister Theresa May suffered a second rejection of her Brexit deal yesterday, as expected, when the Parliament voted down her revamped proposal 391 to 242. As a result, another vote will be held today to decide whether to separate from its largest trading partner without a formal deal in place, a so-called no-deal or “hard” Brexit. That is also expected not to pass. The more likely outcome is for the deadline to be extended, though the time-frame is undetermined. A wide range of other options are on the table, including a second Brexit referendum. However, prolonging the process is only serving to heighten anxiety for businesses, consumers, and investors alike, and markets don’t like uncertainty.
What will the pullback be? The S&P 500 Index corrected nearly 20% late last year, then bounced more than 19%. We think there will be an eventual pullback, but to what extent? Will stocks retest the December lows, see a 10% correction, or something more modest? Today on the LPL Research blog we will explain why we think the eventual pullback will be more modest in nature.
- PPI report (MoM Feb)
- Duable Goods Orders (Preliminary, MoM, Jan)
- Eurozone Industrial Production (Jan)
- China Industrial Production (Feb)
- China Retail Sales (Feb)
- China Surveyed Jobless Rate (Feb)
- Import Price Index (MoM Feb)
- Export Price Index (MoM Feb)
- Initial Jobless Claims (March 9)
- New Home Sales (MoM Jan)
- Germany CPI Report (Feb)
- Bank of Japan Rate Decision (Mar)
- Industrial Production (MoM Feb)
- JOLTS Job Openings Report (Jan)
- University of Michigan Sentiment Index (Preliminary Mar)
- Eurozone CPI Report (Feb)
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Index data obtained via FactSet
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