![\"Real](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-realgdp.png?w=525&ssl=1\")
<\/p>\nAugust labor stats, released today, point to low real GDP growth for Q3. Growth in weekly hours worked came in at a low 1.09% and GDP is likely to follow.<\/p>\n
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While inflation is not the primary concern at the Fed right now, rising annual hourly wage rate growth (3.46% for total private) flags an increase in underlying inflationary pressure. This may make the Fed more hesitant about cutting rates despite Donald Trump’s tweet storm.<\/p>\n
![\"Average](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-wages.png?w=525&ssl=1\")
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Most important is the continued decline in annual payroll growth. At 1.38% for August, further weakness is likely and a fall below 1.0% would warn of an economic slow-down.<\/p>\n
![\"Real](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-payrolls.png?w=525&ssl=1\")
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The S&P 500 is headed for another test of resistance at 3000. The Trend Index oscillating above zero for the last 9 months indicates buying pressure but I expect strong resistance at 3000. Upside is limited while downside risks are expanding.<\/p>\n
![\"S&P](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-spx.png?w=525&ssl=1\")
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Semiconductors are doing better than expected, despite the trade war, but I suspect will weaken when the surge in orders ahead of tariffs tails off.<\/p>\n
![\"Semiconductors\"](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-semis.png?w=525&ssl=1\")
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Retail has stalled since late 2018 and bearish divergence on the Trend Index suggests selling pressure.<\/p>\n
![\"Retail\"](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-retail.png?w=525&ssl=1\")
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Automobiles, in a decline since 2017, have rallied over the last 6 months. But, again, further weakness is expected.<\/p>\n
![\"Automobiles\"](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-autos.png?w=525&ssl=1\")
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On the global front, weak crude oil prices flag an anticipated slow-down in the global economy. Breach of support at $50\/$51 per barrel would be a strong bear signal, warning of a decline to $40 per barrel.<\/p>\n
![\"Nymex](\"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2018\/2019-09-06-crude.png?w=525&ssl=1\")
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We maintain our bearish outlook and have reduced equity exposure for international stocks to 40% of portfolio value.<\/p>\n","protected":false},"excerpt":{"rendered":"
August labor stats, released today, point to low real GDP growth for Q3. Growth in weekly hours worked came in at a low 1.09% and GDP is likely to follow. While inflation is not the primary concern at the Fed right now, rising annual hourly wage rate growth (3.46% for total private) flags an increase … <\/p>\n