"US manufacturing activity contracted at its sharpest pace for nearly 30 years in December, a closely watched survey suggested on Friday, underscoring the downward momentum in the economy at the turn of the year.
The Institute for Supply Managers survey index declined from 36.2 in November to 32.4, much worse than expected, while new orders and production measures hit their lowest level since the survey began in 1948."
My Comments: Economic data continues to worsen. I doubt the sustainability of this January rally in equities. Tactically, I am inclined to reduce risk as markets move higher. I am fairly certain that the Fed will not hike in 2009. Not only that, I think that the Fed's easing bias will remain intact through the year. The RBI cut the Reverse Repo rate by 100bp last week. I think that further easing is likely going forward.
No comments:
Post a Comment