The Dow was down just 0.07% or 10 points at 15,102 with under half an hour to go to the close in New York, while the S&P 500 was down 0.18% at 1658.4. The NASDAQ 100 ventured into positive territory, gaining 0.08% to 3079.8.
We’re at an interesting juncture with the US economy, with solid signs of improvement in the labour market, along with indications that the housing recovery remains healthy in spite of rising rates, but apparently little of this translating into retail spending. Today’s low consumer sentiment reading agrees with the downbeat reports we’ve heard from various retailers in recent weeks.
The market hasn’t responded strongly to any of today’s economic data, suggesting market participants don’t interpret the figures as having any strong bearing on the Fed’s decision to taper or not, but I think the FOMC will be paying close attention to what has been going on.
Although the Fed has explicitly stated the labour market as being an area of focus for them, and that area of the economy has definitely been improving, their ultimate aim is for GDP growth. The US economy is so driven by consumers that softening in this area will be a big drag on GDP and this will be a concern for the Fed.