The Morning Call---Signs that the rally might pause

 

The Morning Call

 

7/17/25

 

The Market

         

    Technical

 

            Wednesday in the charts.

            https://www.zerohedge.com/market-recaps/ppi-powell-pro-crypto-bill-passage-spark-chaos-across-capital-markets

 

                Wednesday in the technical stats.

            https://www.barchart.com/stocks/momentum

            https://www.barchart.com/stocks/sectors/rankings

 

            Signs the rally might pause.

            https://www.zerohedge.com/the-market-ear/heresy-house-bull-seven-unholy-esoteric-signs-rally-might-pause

 

            Dollar snapback.

            https://www.zerohedge.com/the-market-ear/dollar-snapback-widely-hated-painfully-ripping

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

                          Weekly jobless claims totaled 221,000 versus projections of 235,000.

 

                          June industrial production was up 0.3% versus estimates of +0.1%.

                          https://www.advisorperspectives.com/dshort/updates/2025/07/16/recession-indicators-industrial-production-june-2025

 

                                                  June retail sales grew 0.6% versus expectations of +0.1%.

 

The July Philadelphia Fed manufacturing index came in at 15.9 versus consensus of -1.0.

 

                        International

 

The May UK unemployment rate was 4.7% versus predictions of 4.6%; May average earnings (3 MO./YoY) were up 5.0%, in line.

 

The June Japanese trade balance was +Y153.1 billion versus forecasts of +Y353.9 billion.

 

The June EU CPI was up 0.3%, in line.

 

                        Other

 

                          A deeper dive into yesterday’s PPI number.

                          https://mishtalk.com/economics/within-the-benign-ppi-report-is-a-stew-of-tariff-related-inflation/

 

            Overnight News

 

Trump said he’d send letters to more than 150 countries notifying them their tariff rates may be 10% or 15%, though claimed he’s “indifferent” to a trade deal with the EU.

 

The House late Wednesday advanced a trio of cryptocurrency bills and a 2026 Defense spending measure after a group of GOP hard-liners dropped their opposition to the effort following a chaotic day of turnabouts and negotiations with Republican leaders.

 

The Senate passes a bill codifying some DOGE cuts, sending it to the house.

 

Trump said in an interview that the US is very close to a trade deal with India, while an agreement could possibly be reached with Europe as well, but it is too soon to say whether a deal can be agreed with Canada. 

 

            Monetary Policy

 

              Want 35% inflation? Fire Powell.

              https://www.nytimes.com/2025/07/15/opinion/fed-trump-fire-powell.html

 

            Inflation

 

              Fiat ruined the dollar.

              https://www.realclearmarkets.com/articles/2025/07/16/fiat_ruined_the_dollar_with_bitcoin_the_revolt_1122837.html

 

              What the 10 year Treasury is telling us about inflation.

              https://www.capitalspectator.com/10-year-us-treasury-yield-fair-value-estimate-16-july-2025/

 

              Bill Gross argues that danger is inflation not deflation.

              https://www.ft.com/content/9c4d99d0-bbc5-496a-a5c0-e4ec0303e9a2

 

            Tariffs

 

              In defense of Trump’s tariff policy.

              https://townhall.com/columnists/michaelbusler/2025/07/15/trumps-tariffs-are-bringing-us-closer-to-global-free-trade-n2660374

 

              Another.

              https://www.realclearmarkets.com/articles/2025/07/16/imbuing_the_sanctioned_use_of_tariffs_with_greater_understanding_1122845.html

 

                          Counterpoint.

              https://www.explaintrade.com/resources/trumps-trade-threats

 

The case for defending the Court of International Trade’s ruling against Trump’s tariffs (note: the ruling has since been stayed; but that doesn’t change the logic).

https://reason.com/volokh/2025/07/15/defending-the-court-of-international-trade-ruling-against-trumps-tariffs-a-reply-to-estreicher-and-babbitt/

 

                          Trump may be winning the trade war; but is the US?

              https://www.wsj.com/economy/trade/forget-taco-trump-is-winning-his-trade-war-8af6f777?mod=economy_lead_pos5

               

                          Were the early warnings on tariffs overblown?

              https://www.nytimes.com/2025/07/16/business/tariffs-recession-economists.html

 

     Investing

 

            Are you rich?

            https://disciplinefunds.com/2025/07/14/three-things-are-you-rich/

 

            The outlook for S&P dividends.

            https://politicalcalculations.blogspot.com/2025/07/the-outlook-for-s-500-dividends-in-july.html

 

            What is more important? Absolute or relative returns.

            https://www.advisorperspectives.com/commentaries/2025/07/16/relative-returns-absolute-important

 

            Precious metals in season.

            https://talkmarkets.com/content/commodities/precious-metals-in-season-in-reason-and-now-even-more-golden?post=509648

 

            Outcome bias---being right (wrong) for the wrong (right) reason.

            https://www.safalniveshak.com/deception-of-a-good-outcome/

 

    News on Stocks in Our Portfolios

 

Cummins (NYSE:CMI) declares $2.00/share quarterly dividend, 9.9% increase from prior dividend of $1.82.

 

Sherwin Williams (NYSE:SHW) declared $0.79/share quarterly dividend, in line with previous.

 

 

What I am reading today

 

            Thursday morning humor.

           

           

 

 

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