Stocks pressed higher in the face of poor economic reports the past month. So it should be no surprise that the mediocre data on Thursday would give investors the green light to race up to yet another new high.
Both PMI Mfg and Philly Fed came in with readings that show growth…but each was a notch or two below expectations. Jobless Claims was the bright spot as the 4 week average came down to 266K. That bodes well for another month of solid job adds and lower unemployment rate.
Also in the plus column were 10 year Treasury rates falling to 2.19 from a recent high of 2.31. The idea of the Fed staying on the sidelines for even longer certainly helped. Let’s hope this trend continues as lower rates makes stocks more attractive.
This market is grinding higher. It’s so slow that it seems imperceptible to some. But indeed it is happening. So don’t have too much money on the sidelines because when the data goes from mediocre to good, then it will really take off.
aka Steve Reitmeister
Executive Vice President, Zacks Investment Research