Alright, so you already know that I’m not much on paying attention to economic data, at least when it comes to the idea that there’s any cause and effect relationship between the performance of the US economy and the stock market. Sure they correlate for long periods of time. But stocks virtually always start turning at major inflection points well ahead of the first signs of change in the economy.
At market tops, stock prices are usually well below the highs and on their way down before anyone realizes that the economy is in a recession. In fact, markets always top out when the news is good because that’s when the Fed starts tapping the brakes. And markets respond to that tapping virtually instantly.
So the fact that economic data is going gangbusters is not good news. The Fed is tightening and it will continue to apply the pressure until the economy weakens, and weakens a LOT!