The markets remain under pressure on the back of the developing Iranian conflict and the weak ISM Manufacturing Survey.  My friend and former colleague Chris Low who is the Chief Economist of FHN Financial made a good point about the very weak looking ISM today.  He pointed out some of “the remarkable weakness could reflect fires and power cuts in California as well as Boeing’s decision to temporarily  stop producing the 737 Max Jets.”  That makes sense to me given the main fear in Manufacturing of a worsening in the trade war with China was relieved with the announcement of the Phase 1 deal.


I really don’t like finding excuses for economic data, but at times there are reasons for temporary weakness that seems out of place when looking at other data, and this might be one of those cases.  Again, nothing today changes our short-term tactical call or our intermediate-term core fundamental thesis.


We highlighted in this video from mid-December what it would take to get us to be more aggressive buyers from a tactical standpoint – and that hasn’t changed.  It would take a more dramatic spike in the CBOE Volatility Index (VIX) and more significant drop in the percentage of S&P 500 (SPX) component issues trading above their 10-day moving average.


Past performance is not a guarantee of future results. Index returns are unmanaged and do not reflect the deduction of any fees or expenses.

Sign up for more access!

Access additional content across the site when you sign up for an account.

Share this: