Consumers Doing The Heavy Lifting

The American consumer is doing all the heavy lifting and keeping this session from becoming a rout.  Although another behemoth is getting slammed on earnings results, Lowe's (LOW) is proving it’s not retailers, but it is the execution that matters most.

To see the charts, click here, and here.

There is also good action in the semis and that's important. 

Now we wait for the FOMC minutes, and while all the experts keep saying tapering is going to happen sooner rather than later, I'm not so sure.  I think the economy is flashing signs of slowing dramatically in 2022, and the Delta variant is going to play a role.

See comments today from the Central Bank of New Zealand, which did not make any changes. 

However, the need to reinstate COVID-19 containment measures in some regions highlights the serious health and economic risks posed by the virus. Persistent and elevated health risks are promoting ongoing global supply chain disruptions, and are acting to constrain productive capacity and prolong inflationary pressures. Today’s re-introduction of Level 4 restrictions to activity across New Zealand is a stark example of how unpredictable and disruptive the virus is proving to be.

The Committee noted that the New Zealand economy had rebounded more strongly than most countries, with less domestic disruption caused by COVID-19 to date. Employment is currently at or above its maximum sustainable level, and consumer price inflation expectations remain anchored near 2 percent, the midpoint of the target range.  

I must admit, I like the way the market is holding up. Everyone should have some cash.