After posting another new high last week, stocks were taking a breather during Monday’s session. The primary catalyst came out of China. From Reuters:

China’s exports unexpectedly tumbled in February, falling 18.1 percent from a year earlier and swinging the trade balance into deficit. The data underscored recent concerns about the outlook for China’s economy, even though the Lunar New Year holidays were blamed for the slide.

Bullish Case for Stocks: Improving or Deteriorating?

Bear markets are typically associated with (a) economic contraction and (b) deterioration in corporate earnings. When (a) and (b) begin to occur, or are anticipated by investors, their behavior changes in both the stock and bond markets. The Wall Street Journal published the useful “what to watch for” checklist from Strategas Research Partners Monday.

The table above tells us the stock market bears probably have some work to do. In fact, instead of showing weakness, the broad NYSE Composite stock index recently broke out in a manner that aligns with economic confidence, rather than economic fear. 

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