Through midweek last week, tapebombs were absent, so the markets reacted to mixed economic data and some earnings news.

The negative headlines included stunningly weak results for the ISM Non-Manufacturing Index on Tuesday, which came in at 41.9 versus analysts' prior expectation of 53.0 as well as a December upwardly revised reading of 54.4. The disappointing results spurred talk of an inter-meeting rate cut by the Federal Reserve if the economic data remain weak before the committee meets again on March 18. Treasurys rallied sharply on the news, while equities plunged 370 points. Wednesday's fourth-quarter Productivity and Cost news, however, was favorable. It showed a rise in worker productivity and a less-than-expected increase in inflation. Equities strengthened on the news, while Treasurys sold off.

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