Stock Market Update

[BRIEFING.COM] It's been a mixed session for stocks on the final day of the month. Choppy action in the mega cap space, and in Treasuries, has contributed to turbulent moves in the major equity indices. 

There's also new developments on the geopolitical front that market participants are responding to. A short time ago, stocks took a sharp turn lower after President Trump and Ukraine's President Zelenskyy had a heated meeting in the White House, leading Mr. Trump to tell Mr. Zelenskyy he is "gambling with World War III."

Treasuries didn't seem bothered by the news, though, moving mostly sideways after the headlines. Yields were already noticeably lower today following the latest Atlanta Fed GDPNow forecast, which estimates that Q1 GDP will decline 1.5% versus the prior estimate of 2.3% growth. This data plays into recent fears about US growth that have sent yields, and stocks, lower this month. 

Before the meeting in the Oval Office, the major indices were higher across the board. The positive bias followed pleasing economic data this morning. The core-PCE Price Index (the Fed's preferred inflation measure) showed some welcome disinflation on a year-over-year basis.

The upside price action was also driven by turnaround action in mega caps after initial weakness. NVIDIA (NVDA 119.73, -0.45, -0.4%) traded down as much as 3.1% after the open and traded up as much as 3.0% when major indices were near session highs. 

Now, there's not a lot of conviction on either side of the tape. Advancers have a 4-to-3 lead at the NYSE while decliners lead advancers by the same margin at the Nasdaq.

Reviewing today's economic data:

• January Adv. Intl. Trade in Goods -$153.3 bln; Prior was revised to -$122.0 bln from -$122.1 bln
• January Adv. Retail Inventories -0.1%; Prior was revised to -0.5% from -0.3%
• January Adv. Wholesale Inventories 0.7%; Prior was revised to -0.4% from -0.5%
  • The key takeaway from the report is the widening goods deficit. That was likely a byproduct of the tariff push as importers worked to get ahead of the tariffs, yet it will likely stoke President Trump's push to get going with the tariff implementation.
• January Personal Income 0.9% (Briefing.com consensus 0.3%); Prior 0.4%, January Personal Spending -0.2% (Briefing.com consensus 0.2%); Prior was revised to 0.8% from 0.7%, January PCE Prices 0.3% (Briefing.com consensus 0.3%); Prior 0.3%, January PCE Prices - Core 0.3% (Briefing.com consensus of 0.3%; Prior 0.2%
  • The key takeaway from the report isn't singular. There are two: there was welcome disinflation on a year-over-year basis, yet there was a noticeable 0.5% month-over-month decline in real personal spending, which is going to be a big drag on Q1 GDP forecasts. Net-net, not a great report for the growth outlook considering, too, that the personal savings rate jumped to 4.6% from 3.5%.
• February Chicago PMI 45.5 (Briefing.com consensus 41.2); Prior 39.5