Economy Slowing, But Not Stopping

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The real-time economic data is slowing, which could stutter the stock rally. This week in the LPL Market Signals podcast, LPL Research strategists discuss the slowing economic data, gold at new highs, and preview a busy, busy week.

Stalling Economic Data Is Here

The majority of the economic data over the past month has come in historically strong, yet the past two weeks there have been some cracks. As the LPL strategists discuss, real-time data like electricity use, TSA passengers, OpenTable reservations, and mobility data all have stalled. This doesn’t mean a recession is around the corner, but it does play into our thinking that this recovery may be swoosh-shaped—the initial surge off the lows may be the easy part, but future economic growth may be more difficult.

Gold at New Highs

Gold has moved to new highs, above the previous peak from 2011. A weak US dollar, COVID-19, low yields, record monetary policy, and US-China relations have all helped gold gain more than 25% this year. The LPL strategists discuss why this trend is likely to continue and why the strength in silver, copper, and other base metals may mean the global economy probably can continue to improve.

Huge Week

This week will be busy, with nearly 200 S&P 500 Index companies reporting earnings and our continued expectations for a better than expected earnings season. The LPL strategists discuss why the Federal Reserve meeting this week will likely be a non-event, while also dissecting the likely historically poor Q2 gross domestic product (GDP) number that will come out Thursday. The good news is the Q3 GDP number should show a significant jump.

Tune in now

Listen to the entire podcast to get the LPL strategists’ views and insights on current market trends in the US and global economies. To listen to previous podcasts go to Market Signals podcast. You can subscribe to Market Signals on iTunes, Google Play, or Spotify.

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IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth in the podcast may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. All indexes are unmanaged and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

All index data is from FactSet.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This Research material was prepared by LPL Financial, LLC. 

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