Trump fiddled as Q4 burned

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As the President talked up his country's strong economic growth to the Davos crowd, US Q4 GDP was released. The print revealed economic expansion of only 2.6%, well below Q3 GDP growth of 3.2% and the 3% expectation.

The largest component on the downside appears to have been higher than expected imports - not such a great look for the President's "America First" agenda.

Key US stock indices and West Texas crude are up, while the USD and gold are down.

On the upside, Caterpillar, a reliable barometer of development activity smashed its Q4 earnings expectation by around 20% and increased its earnings expectation for 2018, suggesting better times ahead.

Equities markets will be watching with interest to see if the upcoming Q4 earnings season will deliver the same upbeat results as Q3, before reassessing whether or not the market is expensive. Judging by the ongoing complacency and lack of volatility in equities markets (a result of far too many years of QE Rohypnol) it may take some pretty bad earnings results in key sectors to turn Bulls into Bears.