PERFORMANCE

The firing of FBI Director Comey remained in the news this past week. Markets headed south on Wednesday, dropping 1.8%, on news that Trump had asked Comey to “let it go” in regard to the FBI investigation of former adviser Michael Flynn’s ties Russia. That started talk of impeachment and the prospect of President Pence. Later in the week former FBI Director Robert Mueller was named as special counsel in relation to the Russia investigation. It is way too early to give a serious nod to the possibility of impeachment, but all of this political upheaval does reduce the chance of any of Trump’s initiatives getting passed.

As it was, the market recovered towards the end of the week and US equities were only down by 0.3%. International stocks were up 0.9%. Crude advanced by over 5%.

Bonds rallied as interest rates fell.

The spread between the 10 and 2-year treasury note fell to below 1% for the first time since October.

ECONOMY

The GDPNow forecast for Q2 growth increased by 1/2% to 4.1% and the Nowcast increased their growth estimate to 2.3% from 1.9%.

TECHNICAL CHART

The market still remains below the 2401 line we have been watching. It did go through it on Monday and Tuesday, but could not hold the gains.