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Quick Take: Watching Bonuses And Lines In The Sand

|Includes: American Airlines Group (AAL), LUV

Summary

Much of Wall Street is still in Holiday Mode.

But lot's going on here.

I'm watching the lines in the sand and.

While much of Wall Street is still enjoying the holiday season, there will be a fair amount of action for market participants to digest today.

First, I'd be remiss if I didn't acknowledge the way Ms. Market began the year. I believe the saying is, "As the first trading day of the year goes"... ah, you know the rest. (And c'mon, admit it; you checked your account values after yesterday's close, right?)

Looking ahead to today, we have two more companies - American Airlines and Southwest Airlines - providing $1000 bonuses to their employees in response to the new tax law. Personally, I think this will be important input to consider in terms of wage inflation if it catches on and becomes a national trend.

The Key Q: If bonuses becomes a trend, will bond investors panic or recognize the temporary nature of the wage pressure? Or... will the bonuses themselves become a trigger for the wage pressures that economists have been looking for? Stay tuned!

Next, we've got the release of the minutes from the latest Fed meeting this afternoon. Lest we forget, Fed policy remains uber-important to the bond market these days.

And finally, there is the politicking going over keeping the government funded after January 19. The latest wrinkle has Mr. Trump demanding that any deal on spending must include funding for his border wall with Mexico. From my seat, this is the most important near-term issue to watch as the threat of a gov't shutdown could easily trigger some volatility.

But for now, the key is to recognize that the trend is definitely a friend to stock market investors.

Disclosures

The opinions and forecasts expressed herein are those of Mr. David Moenning and may not actually come to pass. Mr. Moenning's opinions and viewpoints regarding the future of the markets should not be construed as recommendations. The analysis and information in this report is for informational purposes only. No part of the material presented in this report is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any investment program.

Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.

Mr. Moenning may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Positions may change at any time.

The analysis provided is based on both technical and fundamental research and is provided "as is" without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.