Reader Note:  We will be direct and to our points this morning due to lightning storms rolling through our part of East Texas this morning.

Perpetual Rally?  No, or course not.  But, in our Aggregate Index work, we were anticipating a high of 23,723.38 and at the close Wednesday it stood at 23,747.95 about 24.6 points higher than the upside minimum target.

We don’t make specific projections about anything, since we’re watchers and not “advisors” but we know from history that all previous rallies have gone up, then had some kind of a correction.

The correction ahead will be interesting.  If we get a mere pullback and then another rally that carries us to new highs, then odds are pretty good that the market will go up over summer and then tank in 2020.  However, since there’s w way to squint at the market just so, this recent rally, since the day after Christmas, looks better as a B wave (or a wave 2) and if that’s the case, then a further 20-percent down may be in the cards.

Too early to tell, but with the news events starting to pile up, it has become an amusing guessing game.  Look at what’s coming up:

  • New figures on Employment are just ahead.  When unemployment moves up half a percent from a significant low, that’s a pretty useful indicator that a recession is ahead.
  • A.I. and job automation continues to evolve and no one is really addressing (at the policy level) where the next set of new jobs will be coming from.  You know, you can only get so far making up “jobs” by creating hysteria’s (climate, sex-pref, gender-change, and social media) just so long.  Then, the fads pass and there’s that terrible sinking feeling.
  • CNN is trying to say the Robt. Mueller fishing and hooker expedition should be out with a report next weekThe Hill is already soft-peddling it and possibly anti-climatic..  Thing is, if that dissed the Donald hard, then the republicans could have  a fool’s foot race with hats in hand.  Which would be in response to the democrats who seem, in our view, ready to go with a “Thelma & Louise” kind of ticket.  Or, a Grampa the Socialist and Jokeahautus.  The politics of today are just insane. Glad to watch from a distance.
  • Data will spill out of other quarters as well, at the ripples of GovDown continue3 being blamed, by among others, Southwest Airlines, for faltering bottom line performance.

These things alone seem to hold potential for the market to briefly sober-up.  More interesting thought are the antics of society outside the hard work, make money and have fun area.

By the way, before I forget, you can get a lot more detail than  what’s in the mainstream on the “domestic terrorist story” by looking up the case number detail and lo and behold, the Feb, 14 FBI agent notes are here.  When you read the notes, please note how much seems to stem from email surveillance…  And look how central the suspect’s use of Tramadol is….which leads us to wonder is this a serious plan afoot, or someone under opioid influence?  More to come out in court, we suppose…

Anyway, that’s our first glance at the headlines that might shape the market, but the Fed Minutes our yesterday were less than worrisome on the inflation front.  As Bloomberg put it “Fed Minutes Show Officials Unsure on Need for Rate Hikes in 2019.”  No surprise for our subscribers.  This has been pretty obvious since our report “Bernanke et al on L4L”  (Lower for Longer) rates piece on the 16th.

We’ve had this gnawing in the pit of the stomach that the Fed maybe got ahead of itself.  Especially when other countries are also adopting the L4L approach.  Example in this Retuers Exclusive: China central bank sees benchmark rate cut as last resort, may use other tools – sources.

OK, that was the foreplay for today’s action up through about 7:15 Am Central.  Markets, that had been showing a higher open, got cold feet and the Dow is looking a bit down… so let’s watch how the data releases roll out, shall we?

Fresh Data

From Census:

New Orders New orders for manufactured durable goods in December increased $3.0 billion or 1.2 percent to $254.4 billion, the U.S. Census Bureau announced today. This increase, up two consecutive months, followed a 1.0 percent November increase. Excluding transportation, new orders increased 0.1 percent. Excluding defense, new orders increased 1.8 percent. Transportation equipment, up four of the last five months, led the increase, $2.8 billion or 3.3 percent to $90.2 billion.
Shipments Shipments of manufactured durable goods in December, up four of the last five months, increased $2.1 billion or 0.8 percent to $259.7 billion. This followed a 1.0 percent November increase.”

Also for your dining pleasure, the new Philly Fed report:  It says some indicators are suggesting weaker conditions:

After release, Dow futures were down 34.

AWK *(also worth knowing)

Strong quake hits Japan’s northernmost main island Hokkaido.  But with an initial 5.5 the 5.6 in Fiji last night was bigger.

EU countries back copyright reforms aimed at Google, Facebook.  Pay attention to this because in my next follow-on to my book Broken Web (2012) you’ll see this kind of IP reform as one of the few ways to slow abuse of copyright on social media.

Dow futures down almost 40, gold futures down $9 and Bitcoins demand $3,910 from modern tulipeers.

Cheeseburger on the road for breakfast as Ure makes a mad dash for supplies from the hardware emporium.  Does this explain why live hogs were down 6-1/2 percent this morning?… moron the ‘morrow.