Stocks will likely find it difficult to sustain recent
positive momentum given the paucity of data over the next few
days. With the earnings season now effectively over, the-ever
evolving Ukraine situation nothing more than background noise,
and not much on the domestic economic docket, we are in a
somewhat of data dead zone on the data front.
The soft trade data out of China over the weekend was a big
cloud on overnight Asian trading and will likely be a net
negative factor in the U.S. trading session as well.
Chinese data over the weekend showed sharp decline in the
country's exports in February, keeping questions about the
country's growth outlook front and center. February exports came
in weaker than expected at down -18.1%, with the trade balance
dropping into a rare deficit, the first since March last year.
The soft trade data has added to the Chinese authorities'
deliberate efforts to weaken the Yuan's exchange value and
follows weak inflation readings and persistent loss of momentum
in the country's factory sector.
Some folks may discount the export shortfall on seasonality
factors related to the timing of Lunar Year holiday and
unconfirmed reports of over-invoicing in the year-ago period, but
the fact remains that China's growth trajectory is far from
On the home front, the only notable economic reading this week is
the February Retail Sales numbers coming out on Thursday. Retail
Sales haven't been doing very good lately, with growth on the
weak side in January and December. This year's unusually harsh
winter likely was a big factor in keeping the consumer indoors
and this week's February data will likely be no different.
Consumer confidence data has been mixed lately, but the hope
is that underlying fundamentals of the U.S. economy remain stable
and will start showing up as the weather improves. The
positive-looking jobs report from Friday, despite some weather
effects, clearly strengthen those expectations.
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