WATCH THESE DATES
The global inflation data were better, and manufacturing expanded at the fastest clip in over a decade. Auto sales rebounded and U.S. sales are now projected to be above 17 million units. Retail sales jumped "post-hurricane" and buyers returned to old-line retail stocks that had been cast aside on news that Amazon was taking over the world. Earnings have been better than the forecasts. Apple made more money last quarter than any company in the history of the world. And the tech sector, awash in cash, moved to all-time highs. Bitcoin blew through the $5000 level on a string of positive developments out of Asia. Tax reformwas center stage and the betting line has turned in favor of getting real reform passed this year. The market has largely ignored health care reform fights, the Iranian nuclear agreement, and the rumblings from North Korea. Passive inflows totaled $500 billion year to date and the spigot is wide open. Recent results from the big banks showed promising loan growth, and the move up in short-term rates buoyed net interest margins. Basic resources joined the advance on 7% GDP growth estimates from China. Central banks continue to be in lockstep, focusing on their mission of full employment, 2% inflation, and modest GDP growth targets. The Fed announced its plan to begin balance- sheet reduction and the market gave the move a thumbs-up. The lyrics of the late, great Tom Petty nail this market environment: "And I'll keep this world from draggin' me down, gonna stand my ground... and I won't back down."
October 24 Markit releases U.S. and European Flash Purchasing Managers' Index (PMI) data.
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October 31 Eurozone release of third quarter GDP data.
October 26-November 2 The ECB, the Federal Reserve, and the Bank of England (BoE) decide on interest rates. In the case of the ECB, the market will be looking for guidance on how it plans towind down quantitative easing. The market anticipates the Fedwill commence winding down their balance sheet, and the BoE is expected to raise rates. Thesewill be key cues for the health of the global economy.
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October 30-November 2 China releases PMI data.
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November 5 ECB to release monetary policymeeting minutes.
American Consequences | 17
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