The divergence in economic data is driving the bond and stock markets.

The divergence in capital markets mirrors the divergence in economic data. Consumer confidence was down from above 130 on the Conference Board’s index in May and remained at the low level of 121.5 in June. At the same time, personal spending and incomes rose at a healthy pace in May and April. The confidence index was affected by the low job growth reported for May and the ongoing trade war with China. The jobs report for June is expected to reflect a much stronger growth in jobs with the unemployment rate remaining at a fifty year low of 3.6%. Nonfarm payrolls are expected to increase by 165,000 after only growing by 75,000 in May.