U.S. equities shrugged off data en route to another record setting close. Economic reports today showed durable goods orders came in well below forecasts and new home sales fell short of expectations. However, the rally was supported by trade optimism after U.S. President Trump said that a U.S.-China “phase one” trade deal would be signed “very shortly.” China said it will lower tariffs on over 850 products. On the equity front, Boeing announced that CEO David Muilenburg will be leaving the company. The shake-up was seemingly well received by the market as share of Boeing jumped nearly 3%. Cincinnati Bell will be acquired by Brookfield Infrastructure Partners and Tesla secured a loan from a group of Chinese banks for its Shanghai plant. Treasury yields were higher, but the U.S. dollar was flat. Crude oil and gold joined equities in a rally. Global equities were more mixed.

The Dow Jones Industrial Average added 96 points (0.3%) to 28,552, the S&P 500 rose 2 points (0.1%) to 3,224 and the NASDAQ was up 21 points (0.2%) to 8,946. 625 million shares were traded on the NYSE and 1.9 billion shares changed hands on the NASDAQ. WTI oil added $0.26 to $60.70 per barrel and wholesale gasoline rose $0.01 to $1.71 per gallon. Elsewhere, the Bloomberg gold spot price rose $7.02 to $1,485.24 per ounce. The Dollar Index—a comparison of the U.S. dollar to six major world currencies—was flat at 97.67.

November preliminary durable goods orders (chart) fell 2.0% month-over-month (m/m), well below the Bloomberg estimate of a 1.5% increase and October’s downwardly-revised 0.2% rise. Ex-transportation, orders were flat m/m, versus forecasts of a 0.1% gain and compared to October’s unadjusted 0.1% advance. Moreover, orders for non-defense capital goods excluding aircraft, considered a proxy for business spending, decreased 0.1%, compared to projections of a 0.2% rise, and the prior month’s figure was unrevised at a 1.1% gain. New home sales (chart) increased 1.3% m/m in November to an annual rate of 719,000, short of the 730,000 forecasts, and October’s level was downwardly revised to 710,000 from the initially reported 733,000 units. The median home price was up 4.5% y/y at $330,800. New home inventory ticked higher to a 5.4 months of supply at the current sales pace from 5.3 months in October. Sales were lower m/m in the South but rose in the Northeast and West, while the Midwest was unchanged. Compared to the last year, sales were higher across all regions except for the Midwest. New home sales are based on contract signings instead of closings.

Treasuries were lower after a modest bear flattening of the curve, in which short-term rates rise faster than long-term rates. The 2-year note saw a 2 basis point higher yield of 1.65%, 10-year note and 30-year bond added a bp to their yields leaving them at 1.93% and 2.35%, respectively.

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