The Dow, Nasdaq, and S&P 500 all hit new record highs yesterday in the wake of economic data that was construed as just right for a soft landing. Consumer inflation disinflated a bit on a year-over-year basis and retail sales activity moderated in April from the prior month.<\/p>\n\n\n\n
The connection for many is that the data were following a path that would allow the Fed to announce its first rate cut no later than September. An added assumption is that the Fed will stick its landing in managing monetary policy deftly enough not to cause a recession.<\/p>\n\n\n\n
Time will tell, but the tell in yesterday’s tape was a hopeful sense of confidence in both regards.<\/p>\n\n\n\n
Treasury yields fell sharply, expectations for a few rate cuts by the end of the year went up in the fed funds futures market, and stocks rallied in a broad-based way from the small caps to the mega caps.<\/p>\n\n\n\n
There isn’t a lot of follow through on that rally effort this morning, but importantly, there isn’t any concerted selling pressure either.<\/p>\n\n\n\n
Currently, the S&P 500 futures are down one point and are trading in-line with fair value, the Nasdaq 100 futures are down two points and are trading in-line with fair value, and the Dow Jones Industrial Average futures are down five points and are trading fractionally above fair value.<\/p>\n\n\n\n
Dow components Walmart (WMT<\/span>)<\/strong> and Cisco (CSCO<\/span>)<\/strong> provided support with earnings results and guidance that met investor approval. Shares of WMT are up 6.2% and shares of CSCO are up 2.1%. Deere & Co (DE<\/span>)<\/strong>, though, took some of their shine away with a reduced profit outlook for FY24. Shares of DE are down 4.8%.<\/p>\n\n\n\n Once again, there is a good bit of attention being paid to the economic calendar. Several reports hit at 8:30 a.m. ET:<\/p>\n\n\n\n\n
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