"Owe nothing to anyone, except for your obligation to love one another. For if you love the other, you will fulfill the requirements of God’s law."
Romans 13:8
"For God so loved the world that he gave his only begotten Son, that whoever believes in him shall not perish but have eternal life."
John 3:16
Stocks backed up and then took off after the CPI data came in 'higher than expected' this morning.
At first glance that seems counter-intuitive. A higher CPI will give the Fed more street cred in raising rates, which is what triggered this whole stock market correction in the first place right?
A closer look at the CPI data, the core CPI (ex food and energy), and especially the last month's revision, shows that at 0.3% core CPI did come in higher than the consensus forecast of economists at 0.2%.
However, in the month prior, that reading which had been 0.3% was revised significantly lower to 0.1%.
So as you can see, the CPI was much ado about not so very much. And stocks, looking at the data behind the headlines, took off like a scalded cat higher.
We can also see on the chart that the SP 500 and NDX futures have now retraced roughly 50% of the correction which they recently endured. Now we will see what this rebound is made of.
Gold and silver were strong today, largely off further Dollar weakness, as Uncle Buck continued taking the gas pipe down. I will post the updated Dollar chart later on.
So here we are, anticipating even more data later this week.
But the foundations of the equity markets are still rather flimsily made, and themselves standing loosely in sand.
Have a pleasant evening.
