I set the arbitrary time frame of 7:30 because it gives the markets a reasonable amount of time to react to the ISM and construction spending reports that just came out.  There's always more to them than just the headlines so as analysts and traders dissect what they feel are the hidden meanings, seemingly directional price momentum can do a complete 180.

We did have an initial pop downwards after the reports, but have since "righted the ship" and are back to 4 ticks positive on the day.  So what was the data?

  • ISM
    • came in at exactly 50.0 signifying no growth and no contraction.  This was .2 worse than last month but .8 higher than consensus, so kind of a mixed bag. 
    • On a positive note for bonds, the "prices paid" component which speaks to inflation, decreased .2 from last month
    • My take: we popped down slightly due to the headline being better than expected, but analyzing a little deeper we see some embedded bond-friendly data.  Taken in conjunction with yesterday's inflation data, it's good.
  • Construction Spending
    • fell .4%
    • drug down by residential construction which was down 1.7% versus 1.1% last month
    • this is 15 straight months of declines, and the the fastest pace decline in 4 months.

Stay tuned, we're still sitting in great shape.  The mere fact that we have made it through the mornings scheduled releases and are still in positive territory is a promising support factor for the broader scale fundamental and technical analysis that has been pointing to ensuing strength.