It was another slow and mixed day, but volatility picked up as the indexes danced around to competing headlines on China trade and potential interest-rate cuts. President Trump sent a chill with comments about how a China deal is not coming soon, but that gives Fed Chair Jerome Powell and his cohorts more reason to cut rates sooner, rather than later.
Better-than-expected retail sales caused a little concern among market doves, but expectations for a July rate cut remain solid, and that is keeping a bid under the market.
Earnings from JPMorgan (JPM) and Goldman Sachs (GS) received a positive reaction, but Johnson & Johnson (JNJ) and Wells Fargo (WRC) were greeted with selling. On Wednesday, night both Netflix (NFLX) and IBM (IBM) report which will give us some idea of the level of expectations outside financials.
It is still a surprisingly sedate market. With the indexes sitting close to all-time highs, the start of earnings season, the likelihood of interest-rate cuts and endless speculation about China trade, there is plenty of fuel for a big market move. But it just isn't happening. Market players are so complacent that we have to wonder if they have been lulled to sleep.
The trend remains up and the bulls have the advantage, but there isn't much traction in either direction right now. A change is coming but for now, we wait.
Have a good evening. I'll see you tomorrow.
GS, JPM and JNJ are holdings in Jim Cramer's Action Alerts PLUS member club.
