Dow Nasdaq Excellent Rise.

Dow Nasdaq Excellent Rise.

The New York Stock Exchange led a strong rally as retail sales and unemployment benefits data were released more solidly than market expectations. The S&P 500 is on track for a six-session winning streak, producing a stunning 6.5% rally.

Retail sales and new unemployment claims announced today are especially meaningful in that they have allayed market concerns about growth and employment: anxiety that a recession could come.

This week was a perfect macro week, given that both producer and consumer prices slowed faster than expected, reaffirming the disinflation trend and easing concerns about consumer demand and job markets significantly with today’s data.

As a result, this signaled an increase in the possibility of a soft landing for the U.S. economy at a time when the Fed’s September rate cut became a foregone conclusion, and of course, it was a great boon for the stock market.

However, the Fed sees a situation where it can think a little more about the rate-cutting stance. If the quick slowdown in last month’s employment report is likely to be hurricane-induced noise, the sticking of service inflation and still strong consumer spending seen this week can’t rule out the possibility that the Fed will turn a little hawkish.

Given that clues to this are likely to appear in the Fed’s July minutes and Jackson Hole symposium next week, it could lead to investors not being able to miss the string of tensions again next week.