Stocks tried to stabilize in the early going, but the combination of a rising dollar and still-squishy Treasuries are making it a hard slog. Gold is lower, while crude oil is higher.
On the news front...
Durable goods orders topped expectations, rising 0.2% in August. A separate indicator of business investment embedded in the monthly report also handily beat forecasts. That said, yesterday’s new home sales report left a lot to be desired. Sales plunged 8.7% to a seasonally adjusted annual rate of 675,000 – well below the average forecast of 700,000.
The Senate came to a bipartisan agreement to extend government funding through mid-November, while a key House vote Tuesday proved successful. But Republican hardliners in the House could still derail the funding bills that need to be passed before September 30 to avoid a government shutdown.
Finally, if you didn’t catch my presentation late yesterday at our Powerful Investing & Trading Strategies Virtual Expo, I shared the following slide on what’s troubling this market. It only seemed appropriate to reference Taylor Swift song lyrics, given how much press she’s gotten lately for showing up at the Kansas City Chiefs football game this past weekend.
But in a nutshell, my message was that a rising dollar and rising interest rates are the big problems for stocks. Unless and until gains in the greenback and yields calm down, the correction will likely continue. That said, it STILL looks like “just” a corrective pullback in the midst of a broader bull run to me.