Stocks rally as yields fall, softening US data, cryptos impress

[PocketOption]

Stocks rally as yields fall, softening US data, cryptos impress

US stocks got a boost from another round of decent earnings and as softening economic data that supports the argument for the Fed to downshift its tightening pace after next week’s policy meeting. ​ Earnings from UPS, General Motors and General Electric did not unravel the optimistic outlook corporate America has been providing this earnings season. Wall Street is locked into mega-cap tech earnings this week, so the current rally will likely lose steam until we hear from both Alphabet and Microsoft after the close.

US Data

A few economic reports all told a similar story today that the economy is weakening. ​ The FHFA and S&P core logic housing reports both showed house prices fell in August. ​ The Conference Board's consumer confidence index declined to a 3-month low as a weakening labor market weighed on the present situation. ​ The Richmond manufacturing index also showed weakness that included decent declines with both prices paid and received.

A weakening economy will bring down inflation and that is good news for long-term investors looking to get back into equities.

Crypto rebounds

Cryptos are rebounding nicely as rates slide and the dollar weakens. ​ Both bitcoin and ethereum are gaining momentum as Wall Street musters up a few strong sessions. ​ The economy is showing further signs of weakening and that is helping investors grow confident that the Fed will be in a better position to downshift its tightening pace after next week's FOMC meeting.

This week is filled with a handful of major risk events that could help keep this week's broader market risk-on rally going. ​ Massive tech earnings, a couple major central bank decisions, and the first look at Q3 GDP will all weigh on risk appetite this week. ​ To the upside, bitcoin should find resistance at around $20,500, while $18,500 provides strong support. ​

Source: Stocks rally as yields fall, softening US data, cryptos impress