Your Monday Market Blip 3/2/20

Your Monday Market Blip 3/2/20

After a heart attack week in which the coin flipping hedge funds feasted on volatility the markets recovered a bit after central banks around the globe indicated they were open to easing monetary supply to boost economic activity. The odds makers moved the probability of a Fed rate cut from 25% to 100% for March. At the close today the Dow was up a measly 1,293 points at 26,703. Trading volume was lower than on Friday. IBD and BTS indicators are still red. The bounce today is nice but we are not out of the woods just yet. In today’s action we saw utilities bounce up as well as the technology sector. Transportation, energy and materials continue to struggle. Some retailers like Costco snapped back to pre-selloff levels as money on the sidelines starts to sniff out deals.
Economic data out of China shows the damage done when millions of people stay home. Fresh PMI manufacturing data showed China’s factory activity dropping from 51.1 to 40.3 while the official PMI reading dropped to 35.7 which is the lowest reading on record. Gaming revenue at Macau plunged 87.8% in February. Meanwhile in the US Personal income rose 0.6% while spending grew 0.2%. Manufacturing data in the US fell to 50.3 from 54.3 in January. The forward looking new orders index moved lower thanks to petroleum and transportation but orders for 14 of the 18 industries showed growth which is a bit odd. Overall the reports show the US economy holding up well as the virus story unfolds.
Crude oil prices stabilized a bit with WTI crude up 4.4% to $6.75 per barrel. After a Friday selloff gold also shot up $27 per ounce to $1,593.