Investors Need to Understand this About Durable Goods Orders

After the Durable Goods Orders data was reported this morning, I noticed a notable downshift in S&P 500 futures. Investors are quick to perceive bad news where it may not necessarily be these days. This data point was expected to be bad on the headline, and it was, but when excluding transportation it was relatively unchanged though still short of expectations. Now transportation does include rail, and rail is integrally tied to the energy industry today, so perhaps there is a fire after all. It all depends on how low you anticipate energy prices to fall and for how long. And it also depends on how deep you expect the damage to reach, because as of today, a good portion of our economy is still benefiting from lower energy prices. Low oil prices may be bad for the energy sector and portions of manufacturing but it’s still probably a net push or positive for the overall American economy. A slowing China, volatile Europe and frenzied emerging markets along with questionable export environment, however, exacerbate concern. Still, the Fed remains accommodative; we just wish they would say so a little more clearly. Now let’s examine the important takeaways from today’s Durables data. See the full report on Durable Goods Orders here.

Market Sector Security	09-24-15 Open
SPDR S&P 500 (NYSE: SPY)	-1.0%
SPDR Dow Jones (NYSE: DIA)	-1.1%
Industrial Select Sector SPDR (NYSE: XLI)	-1.8%
iShares Russell 2000 (NYSE: IWM)	-0.8%
Vanguard Total Stock Market (NYSE: VTI)	-1.0%
iPath S&P 500 ST Futures (NYSE: VXX)	+5.1%

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