Markets continue to struggle for direction, with sharp intra-day swings both up and down. Investors seem unsure of the next move, caught between optimism and caution.
With the government shutdown now entering its 18th day, updated estimates suggest it’s costing the U.S. economy approximately $15 billion per week—not per day as previously feared—which is, relatively speaking, a more positive sign.
Momentum remains stuck near the buy-sell line, while the S&P 500 trades within the same range as last Friday’s broad sell-off. There’s no clear indication yet of a breakout in either direction. That said, I continue to believe a pullback is likely.
The absence of key economic data—thanks to the shutdown—means we’re relying on secondary indicators. This week, we were supposed to receive inflation and retail sales figures, but once again, we’re navigating in the dark.
On the international front, U.S.-China trade negotiations remain uncertain and increasingly tense. The latest Beige Book points to stable employment overall, but with signs of weakening demand and rising layoffs, especially amid ongoing tariff concerns. While Chairman Powell recently commented that layoffs appear limited, he also noted a slowdown in hiring.
Meanwhile, the bond market and precious metals are signaling a more bearish tone—we’ll be watching closely to see which direction the markets ultimately take.
— HPK Provident Advisors
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Disclaimer: The opinions expressed in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. Economic forecasts may not develop as predicted.