Stock market participants remained optimistic, despite impeachment. The economic data were mixed, but consistent with moderate growth in the overall economy.
The House approved (largely along party line) two articles of impeachment against President Trump. There is wide expectation that he will be acquitted in the Senate, whenever that trial takes place.
Real GDP rose at a 2.1% annual rate in the third estimate for 3Q19, same as the second estimate. November personal income and spending data were consistent with about a 2.2% pace of spending growth in 4Q19 (spending accounts for 68% of gross domestic product) – that estimate will change as more information becomes available. Industrial production rose 1.1%, reflecting a rebound from the effects of the GM strike. The Index of Leading Economic Indicators was flat, following three consecutive monthly declines.
Next week, the economic data bunch up on Monday. Durable goods orders tend to be choppy, but seasonal adjustment adds further noise in November and December. Aircraft orders are quirky. Ex-transportation, the data are likely to suggest some stability, but a bigger test will come in 1Q20 (with the production halt of the Boeing 737 Max). New home sales are erratic, but the underlying trend has improved.
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