Market Health Flashing Green for Economy Growth
$DIA, $SPY, $QQQ, $VXX
The powers driving US growth from the financial markets has not been this strong since the late 1990’s.
Goldman Sachs Group Inc.’s (NYSE:GS) index of financial conditions broke through its Internet bubble trough to reach a record low Monday, signaling that the economy may be poised to pick up steam.
The index tracks changes in interest rates, credit spreads, equity prices, and the value of the USD, with a lower reading suggesting expansion lies ahead.
Outgoing New York Fed President William Dudley, who helped develop the gauge while at Goldman Sachs in the late 1990’s, recently suggested that this dynamic “pushes on the side of going faster” with policy normalization.
As long as the stock market continues to be earnings-led rather than P/E-led, investors can all sing Bobby McFerrin’s 1988 song “Don’t Worry, Be Happy.” Or, “Don’t Worry, Be Wealthy.
Monday, the major US stock market indexes finished at: DJIA -177.23 at 26439.48, NAS Comp -39.27 at 7466.50, S&P 500 -19.34 at 2853.53
Volume: Trade on the NYSE came in at: 829-M/shares exchanged
- NAS Comp: +8.2% YTD
- DJIA: +7.0% YTD
- S&P 500: +6.7% YTD
- Russell 2000: +4.1% YTD
Overall, the outlook for the major US stock market indexes is: Bullish to Very Bullish.