Last week was one of the instances where equities and bonds moved in tandem, rather than in opposite directions. Mortgages experienced a general rally throughout the week, while both the Dow Jones Industrial Average and the S&P 500 closed at record highs. Mortgages and bonds showed real strength rallying even after the Fed minutes were released and the phrase “fairly soon” was used in referring to raising rates.
This week’s calendar is full of data, but the highlight will likely occur after market hours. The President speaks to a joint session of congress tomorrow night. If his CPAC speech is any indication, his message tomorrow will be broad and touch upon taxes, immigration, trade, and healthcare. It will most likely lack details, but will set the agenda he wants congress to focus on. Yellen speaks on Friday and it will really be the last opportunity to get the markets prepared if there is going to be a March hike. There are other Fed speakers along the way.
Economic Calendar for the week of 02/27/2017 to 03/03/2017:
Monday: Durable Goods Orders, Pending Home Sales and Dallas Manufacturing Activity
Tuesday: GDP Annualized (QoQ), GDP Price Index, Personal Consumption, Wholesale Inventories, Retail Inventories, S&P CoreLogic 20-City Survey, Chicago Purchasing Manager and Richmond Fed Manufacturing Index
Wednesday: MBA Mortgage Applications, Personal Income, Personal Spending, PCE Deflator, ISM Manufacturing, ISM Prices Paid, ISM Employment, Construction Spending (MoM), Beige Book, and Wards Vehicle Sales
Thursday: Initial Jobless Claims, Continuing Claims, and Bloomberg Consumer Comfort Index
Markit US Services PMI and ISM Non-Manufacturing Composite