Stocks closed higher yesterday with all of the major indexes in the green. The small-cap Russell 2000 led the way with a gain of 1.00%.

But it's the S&P 500 and Nasdaq that are trading just under their all-time high closes made last week. In fact the S&P is just 0.08% away, while the Nasdaq is just 0.02% away.

It was a busy day of economic reports yesterday.

The third and final estimate for Q1'24 GDP came in at 1.4%, up from last month's second estimate of 1.3%.

Weekly Jobless Claims fell -6,000 to 233K vs. the consensus for 236K.

The International Trade in Goods report showed the U.S. goods trade deficit increase to -$100.6 billion vs. last month's -$98.0B and views for -$95.6B. Imports slipped -0.7% m/m vs. last month's 3.1%, while exports were down -2.7% m/m vs. last month's 1.3%.

Durable Goods Orders showed New Orders up 0.1% m/m vs. last month's 0.2% and views for 0.0%. Ex-Transportation it was off -0.1% vs. last month's 0.4% and estimates for 0.1%, while Core Capital Goods declined by -0.6% vs. last month's 0.3% and expectations for 0.1%.

Retail Inventories were up 0.7% m/m, the same as last month. Wholesale Inventories rose 0.6% vs. last month's 0.2%.

The Pending Home Sales Index was down -2.1% m/m, but was an improvement from last month's -7.7% pace. Although, it did miss the consensus for 1.9%. The Index itself came in at 70.8 vs. last month's 72.3.

The Kansas City Manufacturing Index came in at -8 vs. last month's -2.

And Corporate Profits were up 10.0% y/y (after-tax). A solid showing, but under last month's 10.9%. With Inventory & Consumption Adjustments, they were up 5.3% vs. last month's 6.4%.

Today we'll get the Chicago PMI, and Consumer Sentiment. And we'll also hear from Fed policymakers Thomas Barkin, Michelle Bowman, and Mary Daly as they speak at their respective engagements throughout the day.

But the report everybody has been waiting for is this morning's Personal Consumption Expenditures (PCE) index (which is the Fed's preferred inflation gauge). Another report that shows inflation heading back down, like the better-than-expected CPI and PPI reports from two weeks ago, could eventually allow the Fed to cut rates sooner rather than later. Although, nobody is expecting anything until September at the earliest, and more likely November or December.

Nonetheless, every piece of data that shows inflation back on its path toward the Fed's 2% target is a nod for a rate cut.

That comes out at 8:30 AM ET.

With the indexes so close to their all-time highs, it won't take much for them to breakout to even higher highs.

And a friendly PCE report could be just what the markets are looking for.

Best,