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Major Stock Indexes Hit Record High Level

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In this holiday-shortened week — with markets off for Christmas Day Wednesday and closing early tomorrow, Christmas Eve — we see new all-time highs about to be scaled, with pre-markets in the green from Friday’s all-time-high closes. Positive sentiment on low, steady interest rates, a new North American trade deal likely to be finalized and even a possible end to the U.S.-China trade deal on the horizon has kept trading buoyant.

What a difference a year makes! Last December, with trade-war fears weighing heavily and a Federal Reserve tightening the screws on interest-rate levels even in the face of much consternation, Christmas Eve 2018 mercifully ended its half-day of trading having fallen 653 points on the Dow. This helped conclude a sour 2018 overall, where investors saw the results of the slashed corporate tax rates fail to ignite in immediate and lasting ways many had expected.

Now we see 2019 as a full trading year at the highest overall performance rates since 2013. As the market is a reliable forward indicator of the economy, strength in trade, jobs and sentiment appear to keep the forward outlook in positive territory for the foreseeable future.

Today’s Durable Goods headline, however, showed orders cooling faster than expected: -2.0% was a swing to the negative from the +1.0% expected, far from the muted headline +0.2% a month ago. This is the fourth time in the last 12 months we’ve seen Durable Goods orders at -2% or worse, with April of this year hitting the nadir of -2.8%.

Core Capex Orders, Non-Defense, ex-Aircraft — a proxy for business investment, which we’ve seen as a laggard in our overall positive economic data — came in at +0.1%, clearly better than the headline number but well beneath the +1.1% reported last month. Shipments were up 0.3%. Again, we’re seeing hard product manufacturing and delivery lagging the overall strength in the U.S. economy.

Breaking News: A half-hour ahead of the market open, Boeing (BA - Free Report)  shares had been halted pending forthcoming news. This happened as the company gained another half-point in today’s pre-market; shares had been up 2.2% year to date but down more than 11% over the past six months.

The news has finally come out: Dennis Muhlenberg is (finally) out as CEO, effective immediately. Following two crashes of the 737 MAX last year, as Boeing stock was scaling all-time highs, Muhlenberg had come under analytical scrutiny. That shoe has at last dropped this morning.

Chairman Dave Calhoun will take over as CEO, and Lawrence Kelner moves to Chairman of the company. These moves feel like a long time coming, though Boeing shares are still halted from trading. From lows in the winter of 2016, Boeing shares are still up 202%; we’ll see how this major sea-change at the world’s largest airplane manufacturer affects share price going forward. Boring stock is currently a Zacks Rank #3 (Hold) with a Value-Growth-Momentum grade of F.


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