Your Tuesday Market Blip 1/8/19

Your Tuesday Market Blip 1/8/19

China and the US concluded trade talks and a general feeling of optimism was in the air. US Commerce Secretary Wilbur “Pretty Wilbur” Ross felt they could reach a deal that “we can live with” while China’s foreign minister said it had “good faith” in the proceedings. When asked about the trade talks in an interview with Jim “Mad Money” Cramer, Apple CEO Tim Cook said that while the trade deal has many moving parts, he was optimistic that a good deal could be made which would benefit not only Apple but the global economy. The Dow finished the day up 256 points to close at 23,787. Trading volume was light.

The National Federation of Independent Business said its small business optimism index fell slightly from 104.8 to 104.4 in the latest reading. The results were better than expected. NFIB President Juanita “git ‘er done” Duggan noted that while hiring strengthened and job openings are at a record high, the tight labor market and tighter credit trends were a source of frustration for business owners. Positives in the report were that businesses plan to add inventory and actual capital investments were strong. No mention was made on how the gubment shutdown was affecting small businesses.

Credit was tight during December as there were no high yield bond issuances. Big banker, Jamie Dimon, CEO of JP Morgan, was not concerned with this because he said that credit spreads have been abnormally low, and this is more of a reversion to the mean. He believes that there will be growth in 2019 and is optimistic about the economy and, especially the consumer. He points to increasing wage growth and the fact that consumer credit is actually really good, and probably “better than we deserve at this point in the cycle”.

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