Leaders & Laggards 3.5.25
(+/-) The US is enacting or at least talking about fiscal tightening, e.g. Trump called for ending the semiconductor CHIPs Act last night, while China and Germany unveiled massive stimulus policies. It was a “whatever it takes” moment and a big reversal for Germany, which has been in belt-tightening mode for years. Big implications for the global economy.
(+/-) Populism: Yesterday, Treasury Secretary Bessent reiterated a stance he’s made clear: “Over the medium term, which is what we’re focused on, it’s a focus on Main Street. Wall Street’s done great, Wall Street can continue to do fine, but we have a focus on small business and consumers. We are going to rebalance the economy.” Big implications for the?domestic economy.
(+/-) One side thinks there is no real plan, the other is getting behind this idea of an intentional “hard reset” with short-term pain for longer-term gain. It reads like this: reduce fiscal spending/slow the economy to bring inflation down, get long-term yields/10yr down, and shift the economy from overreliance on public capital to private…TBD
(+/-) Load of economic data today, ISM Services, Factory Orders, and Durable Goods, all of it came in-line or better than estimates. It also included some pricing pressures and a lot of concern on trade policy. Still, no discernable deterioration.
(+) From the Fed’s February Beige Book release: “Overall economic activity rose slightly since mid-January. Six Districts reported no change, four reported modest or moderate growth, and two noted slight contractions…Employment nudged slightly higher on balance…Prices increased moderately in most Districts, but several Districts reported an uptick in the pace of increase relative to the previous reporting period….Overall expectations for economic activity over the coming months were slightly optimistic.”
Better day…via Bloomberg & Koyfin…
Good first day bounce off support…
Leaders & Laggards:
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