US stocks are modestly higher this morning being buoyed by strong earnings from Microsoft. This morning, Larry Fink from BlackRock, chairman and CEO of the world's largest money-management firm, said that US stocks should push higher from the current record levels. "People are underinvested in equities ... with the change of tone of central bank behavior and you're starting to see corporate earnings coming in pretty well," said Fink. "We are still constructive on the world." We agree with Mr. Fink and think his statements will age well for we do not see a recession in the near-term horizon and those that are saying it are simply incorrect.
The Bureau of Economic Analysis will release its Gross Domestic Product (GDP) data for the second quarter of 2019 next week and the numbers are looking to decline from the strong 3.1% recorded in the first quarter. Most estimates are calling for a rise of around 2% as the US is now in its longest stretch of economic expansion in history. At this point in time, the US economy still has room to grow after strong June retail sales and manufacturing data reported in the past few weeks. The US labor market remains strong while Americans filing for first-time unemployment benefits are near 50-year lows. GDP is the value of the goods and services produced in the US.