Karim writes:

Hard to believe we are still getting August data, but durables came in better than expected:

  • Headline -0.1%, but core +1.1% and prior month revised from -1.5% to -0.2%
  • Core shipments up 2.8%
  • Shipments number likely reflects some impact from global supply chain resumption early in Q3
  • Q3 still looks about 2% growth

Yes, seems again this year markets fail to recognize the support for aggregate demand that comes from an 8.5% US federal deficit.

Q3 earnings should also be strong, as GDP has been increasing sequentially all year as well.

And with lower gasoline prices, Q4 could be up from Q3, though as Karim suggested, Q3 may have started higher and ended on a weak note.