Francois Trahan, M²SD
Francois Trahan: "We now have 4 regional PMIs available for the month of January with the broader economy PMIs set for release next week. Thus far, 3 of the 4 regional PMIs were down, and the one that is higher, (the Philly Fed Index) is only up a few points and still in negative territory. The NY Empire Fed Index was especially weak in January (kind of looks like too much of a drop to be legit?!). That said, even if we trim the Empire's decline by half for the month, an average of these 4 series is still pointing to weaker earnings in the coming months. The ISM release next Thursday will give us a broader view of things, but as of now this data does not jive with how the markets are behaving. It does jive with how earnings are coming in, however, as plenty of cyclical companies have disappointed in their reports (and banks especially). One to keep an eye on ... we get one more piece of the puzzle on Monday (Dallas Fed Index). Happy Friday. FT"
