Depending upon one’s preconceived bias, yesterday’s economic data can be viewed as either half full or half empty.

Initial jobless claims printed above consensus 898k.  On the other hand, continuing claims were substantially lower than expected at just over 10 million, the lowest level since March 27.

The Empire Manufacturing Index was a little weaker than forecast but the Philly Fed was twice as strong as expected.  The consistency between the two regional manufacturing indices is that the “new orders index” rose in both surveys.

How will today’s retail sales data be interpreted.

Radically changing topics, Goldman wrote yesterday growth stocks could be at a “Minsky Moment, a phenomenon where a period of consistently strong returns breeds recklessness that becomes unsustainable and ends in a market collapse. 

It is the proverbial “ah ha” moment where reality crushes unfounded thinking.  The disparity between value and growth stocks according to Goldman is at the greatest difference since the 1930s, the decade before when Benjamin Graham wrote the Intelligent Investor.

Commenting upon yesterday’s market activity, equities trimmed losses as all awaited news on negotiations over a fresh round of stimulus amid a resurgence in COVID cases around the world.  Energy and financials…aka value…led the rebound.  As widely noted energy and financials are down about 50% and 37% YTD, respectively.

What will happen today?

Last night the foreign markets were mixed.  London was up 1.33%, Paris p 1.49%  and Frankfurt up 0.89%.  China was up 0.14%, Japan down 0.41% and Hang Sang up 0.94%.

The Dow should open flat.  The 10-year is up 2/32 to yield 0.73%.


The views expressed herein are those of Kent Engelke and do not necessarily reflect those of Capitol Securities Management. The information contained herein has been compiled from sources believed to be reliable; however, there is no guarantee of its accuracy or completeness. Any opinions expressed are statements of judgment on this date and are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated or projected. Any future dividends, interest, yields and event dates listed may be subject to change. An investor cannot invest in an index, and its returns are not indicative of the performance of any specific investment. Past performance is not indicative of future results. The material provided in Daily Market Commentaries or on this website should be used for informational purposes only and in no way should be relied upon for financial advice. Please be sure to consult your own financial advisor when making decisions regarding your financial management. Members of FINRA and SIPC, Capitol Securities Management is a privately owned full-service retail brokerage and investment advisory firm headquartered in Richmond, Virginia. For nearly 30 years, we have been serving the needs of our investors. Today, more than 200 Capitol Securities Management investment professionals and support staff serve approximately 18,000 customer accounts from Southern Florida to the New England coast.