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Stock Market Update

January ISM data released and came in at 50.7, which is just a hair above contraction. (numbers below 50 indicate contraction in the manufacturing sector). Last month the number was 47.3. While today’s number is a few points higher the trend remains to the downside.

The markets started out not knowing which way to go. After the ISM data the bulls gained some momentum but were still watching as the move up seems to be catching some selling on the way up which is pulling the reins on the bull.

Another factor now being bantered about is that the weak employment report this morning now has the chances of yet another Fed Funds rate cut on the table. Futures are showing the chances of another 50 basis point rate cut is rising. Good heavens, another rate cut… the poor dollar. We might as well wall paper our homes with dollar bills as they will be worthless if they keep cutting rates. Inflation will get out of control.

Construction spending for December came in very poor. The value of -1.1% is twice as bad as was expected.

And just now crossing the wires:

MOODY’S: SOME BOND INSURERS WILL LIKELY BE DOWNGRADED

Oh how I wish for a normal market again, this is getting crazy!

We’re watching the events closely here.