The Dividend Cafe - The DC Today - Thursday, November 16, 2023

Episode Date: November 16, 2023

Today's Post - https://bahnsen.co/40JB5EW It was a pretty quiet day today, although we were down almost 170 points mid-day following some slower economic numbers to then rally back to just about flat on the day in stocks. Honestly, with the significant move up this week, just seeing markets just hang in and constructively consolidate and stay at these levels (both in stocks and bonds) is a good thing and bodes well. This week, we had lower-than-expected inflation numbers in both CPI and PPI, some weak retail sales, the largest US retailer citing disinflationary pressure, and today, we got a jobless claims number that was higher than expected. Mix all of this in a bowl, bake, and no matter how you slice it, you’ll get an unquestionably cooling economic pie. See what I did there as we head into Thanksgiving week. =) Links mentioned in this episode: TheDCToday.com DividendCafe.com TheBahnsenGroup.com

Welcome to the DC Today, your daily market synopsis of the Dividend Cafe, brought to you every Monday through Thursday to bring you up-to-date information and perspective on financial markets. Hello and welcome to DC Today. Brian Seitel with you here again. It's Thursday, November the 16th. Was good to be here with you out of New York and had a good week in the city and all that. And David was slated to be here with you today, but had some further meetings.

So I'm going to stand in here. But kind of a flat day really on the market. So a bit quiet. We actually were about flat in the morning and then sort of traded down about 170 points mid-morning. There was some weaker than expected economic data and markets just took the steam out of stocks a bit. It did put a rally in the bond market. The 10-year was down nine basis points on the day, closed at 445. And again, having quiet or flat or non-volatile days following a really pretty big move up is a good thing.

It bodes well for markets. It's what you want to see. You want to see consolidation. You want to see sort of an active trading area around a certain range to support where things have moved. And it does speak to inflation really coming down. And this week, the numbers that we got were quite a few of them in data points. We had CPI come in. That was much them and data points we had cpi come in that was much lower than expected we had ppi come in lower than expected again those are two of our

main inflation readings come in far cooler than than we thought we had retail sales negative and weak yesterday so consumer giving back a little bit not a lot but a little bit weaker and then the largest retail in the country today, after earnings, and you can guess who that is, cited not inflationary pressures and dealing with higher wages and things, but the opposite, disinflationary pressures. So they're a retailer selling goods and the prices have to be lower in order to attract buyers. So it's kind of a disinflationary, a lower amount of inflation happening in that retailer. And then today, we had jobless claims that came in a little higher than expected. We were expecting 220. We got 230,000. So when you combine all of

those, say, five or six data points, every one of them is speaking to lower inflation, cooler economy, those types of things. And that's what the Fed wants to see to feel good about where they're taking rates. And maybe it is just sort of porridge is just right. Maybe they didn't overdo it. We won't get a slowdown, but time will tell. Technically, unemployment has gone from 3.4 to 3.9 and a 50 basis where a half a point move has usually led to a contraction, but that's not what we're seeing today. has usually led to a contraction, but that's not what we're seeing today. So all that to say, the Philly Fed index was still negative, but it was better than expected. We were expecting a negative 11 print on it.

We got a negative 5.9. So not a whole lot to report there other than just a little better, but still negative. The energy, this kind of goes, so if I painted all these things together, you had a little bit more unemployment or a little bit more jobless, both initial claims and continuing. You had obviously this lower inflation, all those sorts of things.

You also have energy that pulled back quite a bit. Energy oil was down about 5% today. And again, that's on weak consumer perception of demand, really. And then you have a bond market rally. So if you painted all those things together, they're just pointing towards an economic soup of things slowing a little bit and cooling down. The Biden meeting with Xi Jinping today was, I'm sorry, yesterday, really ended yesterday. They agreed on some things. I sort of felt like it was a little par for the course. They basically agreed that climate change is bad and they should address it, that fentanyl is bad. And then we agree that, you know, we don't want to curb the exportation of it. There was some agreement on communication with the militaries and the use or controlled use or non-use of artificial intelligence with military applications, things like that.

There really wasn't any big headway made on big issues like trade between the two biggest economies in the world and so forth and anything on Taiwan either. There wasn't a whole lot of headway made with agreeing or disagreeing on Taiwan. Biden reaffirmed the one China policy that the U.S. has had, which has great language inside of it. And China said that we should stop shipping arms there and that Taiwan is essentially a de facto part of China, blah, blah, blah. So same old story there. So I'd say communication was a good thing. Not a whole lot came part of China, blah, blah, blah. So same old story there. So I'd say communication was a good thing. Not a whole lot came out of it, but it's more market friendly than otherwise. In other words, not talking. The Senate actually passed the bill that was sent from the House, which is good to keep the government open. So we've got a funded government

here for the next couple of months into the new year. And then we'll just kick the can down the road and worry about how we're going to figure it out then. But at least it'll be open through the holidays, right? Okay, so all that to say, you know, on a quiet day like this, I'm going to end it there for the day. It's always good being with you.

I said this yesterday, but I didn't know I was going to be with you today. So I'll say it again today. If I don't hear from you, I wish you all a wonderful Thanksgiving with your family and reach out anytime with any questions. That's what I'm here for. With that, I'll send it off and have a good evening. Thank you. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, with Hightower Advisors LLC, a registered investment

advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory Thank you. of the date referenced. Such data and information are subject to change without notice. This document was created for informational purposes only. The opinions expressed are solely those of the Bonson Group and do not represent those of Hightower Advisors LLC or any of its affiliates. Hightower Advisors do not provide tax or legal advice. This material was not intended or written to be used or presented to any entity as tax advice or tax information. Tax laws vary based on the client's individual circumstances and can change at any time without notice. Clients are urged to consult their tax or legal advisor for any related questions.