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Economic Data Deluge

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We see some good news this morning from the latest headline on the U.S. Trade Deficit: at -$43.1 billion, it’s not only lower than both the -$43.6 billion expected, but the lowest level recorded since October 2016. Today’s headline comes for the month of November 2019. October’s revision improved, as well — from -$47.2 billion originally reported to -$46.9 billion this morning.

The past couple years has seen the deficit on U.S. trade plummet, to beneath $60 billion — approaching all-time record lows in the early 2000s — in December 2018. Today’s figure offers some hope that the deficit can back to a more manageable plateau not seen for the past 4-5 years. As plans begin to firm regarding a “phase one” deal in the ongoing U.S.-China trade war, hope rises for a steady path to bring down the deficit further.

After today’s opening bell, new ISM Nonmanufacturing data for December is expected to increase month over month, from 53.9% last time around to 54.5% this morning. These figures remaining buoyant above the 50% mark are innately good news, especially contrasted with ISM Manufacturing results last week which came in worse than expected: 47.2% for December was worse than the 49% expected and 48.1% from the previous month.

We also expect Factory Orders tallies later this morning for the month of November, though these numbers look to take a step down sequentially: -0.8% estimated, versus an actual of +0.3% for October. These figures, of course, are in arrears as the Trade Deficit totals are; a backward look at economic data like this mostly fills in missing puzzle pieces from the environment already passed.

Tomorrow we get new private-sector payroll data from Automatic Data Processing (ADP - Free Report) , which precedes Friday’s big non-farm payroll report from the U.S. Bureau of Labor Statistics (BLS). The previous month’s numbers were so good we saw an early Santa Claus rally which helped take our market indexes to new all-time highs; can the new figures climb the wall of worry the recent Middle Eastern geopolitical strife has caused? Market participants look forward to finding out.


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