Stocks closed mixed yesterday, but the Dow and the S&P gained a solid 0.65% and 0.41% respectively. That extends the S&P's winning streak to 4 days in a row.

Stocks continue to find support after Monday's announced U.S./China trade progress, which dramatically slashed tariffs on both countries for 90 days, and paved the way for further talks in the coming weeks; the previous week's trade deal with the U.K.; and this week's mostly better-than-expected inflation reports.

Tuesday's Consumer Price Index (CPI – retail inflation), showed inflation easing with the headline number coming in at 2.3% y/y vs. last month's 2.4% and estimates for the same, while the core rate (ex-food & energy) came in at 2.8%, in line with last month and the consensus.

Yesterday's Producer Price Index (PPI – wholesale inflation), was even better with the headline number falling -0.5% m/m vs. last month's 0.0% and estimates for 0.2%. The y/y rate fell to 2.4% vs. last month's 2.7% and expectations for 2.4%. The core rate fell as well by -0.4% m/m vs. last month's 0.4% and views for 0.3%. The y/y rate fell to 3.1% vs. last month's 3.3% and estimates for 3.1%.

While the Fed has been expressing concern over the possibility of rising inflation due to tariff uncertainty, none of that of is showing up in the numbers yet. In fact, inflation has continued to ease.

Nonetheless, the uncertainty, coupled with the Fed's acknowledgement that "economic activity has continued to expand at a solid pace," has prompted the Fed to adopt a wait and see attitude. That was the key takeaway from last week's FOMC meeting – that the Fed feels good enough about the economy where it can afford to wait and see what impact the tariffs have. But, their willingness to wait (which I'm interpreting as the economy is not in need of support) is a positive assessment.

And it's one of the reasons why the market keeps climbing, in spite of the Fed's hesitancy to resume rate cuts.

But given the recent trade deal with the U.K., the sharply reduced tariffs between the U.S. and China, and the prospect of plenty more high-level trade deals expected to be announced in the coming weeks (which should further reduce tariffs), those tariff/inflation concerns should already be allayed, since the worst of the tariff fears seem to be well behind us.

In other news yesterday, Weekly Jobless Claims were unchanged at 229,000, in line with last month and the consensus.

The Philadelphia Fed Manufacturing Index improved to -4.0 vs. last month's -26.4 and expectations for -10.0.

The Empire State Manufacturing Index, however, slipped to -9.2 vs. last month's -8.1 and views for -7.5.

And Retail Sales rose 0.1% m/m vs. last month's upwardly revised 1.7% (from 1.4%), and views for 0.1%. Ex-vehicles, it was up 0.1% as well vs. last month's 0.8% and estimates for 0.3%.

We'll hear from another 55 companies on deck to report today.

As for economic reports, we'll get the Housing Starts and Permits report, Import and Export Prices, and the always important Consumer Sentiment report.

With one more day to go in the week, all of the indexes are in the green. That would only make it one up week in a row for the Dow, S&P 500 and Nasdaq (although it would mark their fourth up week out of six). But it would be the 6th up week in a row for the small-cap Russell 2000 and the mid-cap S&P 400.

Best,