Trump Speaks, U.S. Economic Data Brief

Today’s U.S. session is full of economic data releases and news. As we move closer to the FOMC meeting next month, the relevance of these metrics grow. Pending U.S. FED decisions regarding interest rates and the balance sheet will begin to have more influence upon the markets.

Can Wall Street Keep Up The Momentum?

Last night’s comments from President Trump regarding the future of NAFTA made headlines. In his speech in Arizona, Trump stated that “we’ll probably end up terminating NAFTA at some point.” This is a bold statement and one that has the potential to impact today’s markets.

It can be a challenge to trade strictly on fundamentals. But, they often drive markets and create opportunity. Our job as traders is to interpret the data and capitalize accordingly.

Tuesday’s Rally

Tuesday’s U.S. session was a good one for equities, with all major indices closing substantially higher:

• DJIA                     +160.00  points

• S&P 500               + 18.76  points

• NASDAQ 100       + 56.04  points  

The futures markets were also extremely bullish. All of the major contracts facing U.S. equities closed trend day up.

Today’s U.S. Economic Data

There is a lot going on for today’s U.S. session. Currently, FOMC member Kaplan is speaking regarding the state of the U.S. economy. As my colleague Skerdian discussed a bit earlier, the economic symposium in Jackson Hole, Wyoming is coming into focus.

Here is today’s data:

            Event                                               Previous         Projected            Actual

Markit Manufacturing PMI (Aug)                        53.3               NA                    52.5

Markit PMI Composite (Aug)                              54.6               NA                    56.0

Markit Services PMI (Aug)                                  54.7              54.9                  56.9

New Home Sales (MoM, July)                            610,000         612,000           571,000                                  

New Home Sales Change (MoM, July)               0.8%              0.3%                  -9.4%

So, will the strength in U.S. equities continue? It is a bit early to tell, but today's housing data is not positive.

If Trump’s statements regarding the termination of NAFTA prove true, then we are looking at a fundamental restructuring of the North American economy. The next 30 days are going to be huge for the indices. Buckle up.

Putting all of these numbers into the proper context can be a challenge. For trading ideas, strategies and signals, stay tuned to FX leaders.

As always, trade smart and for tomorrow!