Can the Dow Sustain it’s 5-Day Winning Streak? – 11 September 2019

Wall Street futures were pointing to little change for the upcoming session open, but traders are wondering whether the Dow Jones Industrial Average can keep its current 5-day winning streak on track or whether today’s data releases will end the longest run for the benchmark index since June.

The latest data released from the Mortgage Bankers Association showed that mortgage applications rose 2 percent last week as compared with the prior week, with volume 69 percent higher than the same week last year, largely due to the lower interest rates that American borrowers are enjoying now.

U.S. President Donald Trump continued to throw jabs at the Federal Reserve on Wednesday, calling the economic policymakers “boneheads” in a tweet and saying that “The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term.” Though the Fed has long posited that it will not give in to the President’s demands, another 25 basis-point rate cut is expected after the central bank’s policy meeting next week.

Earlier on Wednesday, China’s Ministry of Finance announced its intentions to exempt 16 types of U.S. products from its upcoming round of tariffs. The exemptions will be relevant for one year, until mid-September 2020. Products that will be exempt from the tariffs include drugs, lubricants, and food for livestock and seafood. The announcement of these exemptions increased optimism about next month’s trade talks between high-level U.S. and Chinese officials in Washington next month. The alternating optimism and pessimism relating to the trade war has kept U.S. benchmarks in extremely volatile positions in recent months.

In the meanwhile, companies are eager to take advantage of the current 10-year bull market before things turn south or a recession comes, which many analysts are expecting, in part due to the length of the current uptrend and in part due to the trade war which can have even more negative impacts on the market if it continues in the long run. Nearly 70 companies have registered with the SEC to go public, and they’re hoping to do so while buyers remain in the market.

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