January 5, 2023
Good morning,
It is Morning Note Thursday due to the holiday-shortened week. Back to M-W-F as usual next week.
Overnight price action has seen a modest reversal of some of this week’s trends in global markets. Yields are up in Treasuries after a rather dramatic decline in longer duration issues earlier this week. Gold has pulled back and European equities have stopped going up. Futures are soft, down -.50% on some not very negative jobs data from ADP. Remember, investors want a weakening employment picture to verify receding inflation – they didn’t get that this morning from the ADP data. That notwithstanding, volume is low, and traders seem to be sitting on their hands – maybe due to tomorrow’s key data points (U.S. payrolls and euro zone CPI).
I am increasingly frustrated because I don’t have a good “feeling” about the equity market in the months ahead. But I don’t yet have the market data required to make a defensive call, and I am committed to a disciplined data driven investment process. It’s never easy – see you Monday.
Be well,
Mike