Daily Insights

Powell day-one testimony takeaways. In the first of two-days of testimony before Congress, Federal Reserve (Fed) Chairman Jerome Powell provided few new insights regarding the central bank’s views and expectations. He reiterated the Fed’s favorable economic outlook while acknowledging challenges to growth such as an economic slowdown in major foreign economies (including China and Europe), and elevated uncertainty around Brexit and ongoing trade negotiations. Today he meets with the House Financial Services Committee.

Consumer confidence rebound. The Conference Board’s Consumer Confidence Index trounced consensus expectations this month as Americans’ views on present conditions hit an 18-year high while forward expectations saw its biggest monthly jump since 2011. The rebound comes on the heels of a nine-week win streak for the Dow and Nasdaq, a healthy job market showing signs of strong wage growth, meaningful progress in U.S.-China trade negotiations, and last month’s end to the longest partial government shutdown on record. The data align with other recent reports, such as Markit PMI Services and several regional Fed indexes, suggest weakness seen at the end of last year may have been transitory.

Up the first two months? The S&P 500 Index gained nearly 8% in January and has added another 3% so far in February with two days to go. What does this potentially tell us? Well, since 1950, the S&P 500 has been up in each of the first two months 27 times and the final 10 months gained 25 of those times. Additionally, the average return over the final 10 months has been substantially better than the average year. Today on the LPL Research blog we will take a closer look at this potentially bullish phenomena.

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Wednesday

• Pending Home Sales (MoM, Jan)
• Durable Goods Orders (Dec)
• Eurozone Economic Confidence Index (Feb)
• Japan Industrial Production (Preliminary, Jan)
• China Manufacturing PMI (Feb)

Thursday

• GDP Report (QoQ, Q4 2018, Initial and First Revision)
• Germany CPI Report (Preliminary, Feb)
• Japan Jobless Rate (Jan)
• Japan Tokyo CPI Report (Feb)
• Caixin China Manufacturing PMI (Feb)

Friday

• Core PCE (MoM, Dec)
• Markit US Manufacturing PMI (Feb)
• ISM Manufacturing PMI (Feb)
• University of Michigan Sentiment Index (Feb)
• Japan Consumer Confidence Index (Feb)
• Germany Unemployment Claims Rate (Feb)
• Eurozone Unemployment Rate (Jan)
• Eurozone CPI Report (Feb)

IMPORTANT DISCLOSURES

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

All company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities.

All performance referenced is historical and is no guarantee of future results.

This research material has been prepared by LPL Financial LLC.

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Index data obtained via FactSet

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