US Economy Continues to Expand

$DIA, $SPY, $SOX, $QQQ, $RUTX, $VXX

FLASH: This economic expansion is set to become longest in US history, according to the latest leading-indicators data.

The Conference Board Leading Economic Index (LEI) for the US increased 0.2% in April to 112.1, following a 0.3% increase in March, and a 0.2% increase in February.

“The US LEI rose in April, the third consecutive increase, with a majority of the leading indicators making positive contributions,” said the Director of Economic Research at The Conference Board.

“Stock prices, financial conditions, and consumers’ outlook on the economy buoyed the US LEI, although the manufacturing sector showed continuing weakness. The Conference Board expects economic growth to moderate toward 2 percent by year end. The current expansion will enter its 11th year in July, becoming the longest expansion in U.S. history,” he said Friday.

President Trump earlier this week called on the Fed to “match” what he said China would do to offset economic hardship being caused by tariffs as he sought to draft the US central bank into his 10 month trade dispute.

“China will be pumping money into their system and probably reducing interest rates, as always, in order to make up for the business they are, and will be, losing,” the President said in a Tweet Tuesday.

“If the Federal Reserve ever did a ‘match,’ it would be game over, we win! In any event, China wants a deal!”

His suggestion that the Fed could help him counter China in the countries’ trade dispute builds on President Trump’s repeated efforts to pressure the policy makers to stimulate the economy, even though growth is solid and unemployment is at a near 50-year low.

The President’s comments will likely feed concerns in other countries over Trump’s willingness to break long-standing norms of international economic diplomacy. The US has complained about other governments applying political pressure on central banks and argued that Fed policy is driven by domestic economic priorities rather than any international competition.

Fed officials raised interest rates 4X last year but have since signaled an extended pause as they wait for a tight labor market to lift inflation that has been persistently too low.

Friday, the major US stock market indexes finished at: DJIA -98.68 at 25764.00, NAS Comp -81.76 at 7816.26, S&P 500 -16.79 at 2859.53

Volume on the NYSE came in at 871-M/shares exchanged

NAS Comp +17.8% YTD

S&P 500 +14.1% YTD

Russell 2000 +13.9% YTD

DJIA +10.4% YTD

HeffX-LTN’s overall technical outlook for the major US stock market indexes is Bullish at the week ended 17 May 2019.

Making and Keeping America Great!