Stocks continue to rally as all major indexes pushed to new highs. The Dow gained 63 points to 22,331 on lighter volume for its 5th straight record close.
The Federal Reserve will meet this week and most likely will not raise interest rates. While this is not a for sure “done deal” what is expected to happen is the beginning of the unwinding of the Fed’s $4.5 trillion balance sheet of mostly gubment and mortgage backed bonds that were built up during the financial crisis. The Fed is expected to announce the sale of $10 billion in bonds per month starting October and while some folks worry about the effects of this on interest rates and the market, David “Kostco” Kostin at Goldman Sachs thinks the gradual run off from the Fed’s portfolio will nudge interest rates up and help bank stocks while limiting returns on bonds and interest rate dependent sectors like utilities. We shall see how it plays out.
As “Rocket Man” continues to shake up the world nuclear stage, US based Northrup Grumman has made a move to profit from it by leaping into the missile defense business via the purchase of Dulles, VA based Orbital TKA for $9.2 billion smackers. Orbital TKA specializes in launch and test vehicles used in anti-missile systems and provides boosters for Boeing's Ground-based Midcourse Defense (GMD) system (code named “Ka-ching”) which is used by the U.S. Missile Defense Agency.
Some clients have asked about the Equifax data breach and for the record, KMS does not use Equifax. If however you get a call from someone like “Nesbit” or “Biff” claiming to work for Equifax don’t give them any information. To find out if you were affected go to: equifaxsecurity2017.com.