It’s official: The economy is slowing down. Poor ISM Manufacturing and Services reports point to the state of the U.S. economy, as does a recent near disinversion of the yield curve. At the same time, July’s employment data came in weaker than expected, but not enough to suggest an impending recession. Experts believe weather-related factors may have skewed the numbers, so there’s no need to hit the panic button just yet.
But, in the face of all this, stocks have rallied. Despite soft economic data, the market seems to be overlooking these warning signs, which raises questions about the sustainability of this optimism. As we head into Fall, it is worth keeping an eye on market volatility to see if the markets begin to reflect real-world conditions more closely.
#EyeOnVolatility
