The S&P Global Flash PMIs told the tale today. Manufacturing cooled to 52.0, down from 53 — still above water, but slowing. Services slipped too, pulling the Composite down to 53.6. Translation: growth is still there, but the pace is fading. And here’s the kicker — factory inventories are piling up at record levels. That’s not “just tariffs,” that’s a demand warning.
At 10:00 AM, new home sales ticked in line with expectations, showing that middle-class housing demand hasn’t rolled over yet. A bright spot, but fragile.
Powell on Deck
At 1 PM, Jerome Powell stepped up. No fire and brimstone, no Trump-style brawl, but a reminder that inflation’s sticky, asset valuations look inflated, and cuts aren’t a free lunch. For investors betting on Miran’s sharper knives, Powell basically said: not so fast. Markets flinched. Tech and growth names took it on the chin, defense and energy held steady.
Earnings Spotlight: Micron (MU)
After the bell, Micron beat expectations. $11.3B in revenue vs the $11.15B whisper, AI chips doing the heavy lifting. China probes remain a risk, but the bigger story is reshoring. If tariffs force supply chains back home, Micron is positioned as a GOP-aligned play on American strength.
My GOP Take
- Tariffs sting factories: Sub-50 was my worry — we didn’t go there, but the inventory glut screams stress.
- Services buffer softening: Still positive, but losing steam. The consumer engine isn’t invincible.
- Powell vs. Trump, Round 2? Powell’s caution contrasts with Miran’s rate-cut drumbeat. Don’t expect fireworks yet, but the clash is brewing.
- Micron call pays: Earnings beat confirmed. If reshoring headlines gain traction, MU could ride a 5–10% pop over the week.
My Play
I’m staying with Micron calls. Tariffs + AI = long-term tailwinds, even with short-term China noise. Watching defense names as Trump leans harder into EU “unfair deal” rhetoric — the tweetstorm chatter mid-week could juice the sector.
