Export Ambiguity

US export data came in much higher than expected, causing many economists to increase their estimate of 2Q growth to 3%. The weak US dollar has benefitted many US companies with global markets, but exports aren't the 'feel good' driver that most consumers can feel, well, good about!! The higher than expected net exports will be the key driver for GDP growth in the second quarter, but employment weakness is still prescient in the minds of most Americans. For this reason, you still might hear the now-common response to the question, "How are you?", "Well, fine considering the economy!". Sure, it feels bad, but the increase in exports more than likely means that large US companies are still generating sales and will continue to do so if the dollar stays weak. The dollar has strengthened over the last few weeks but it is coming off an all-time low versus the Euro so US goods are still cheap to foreigners. Within portfolios, make sure there is some exposure to the large cap space with international markets. The dollar should continue to strengthen, but it won't happen quickly!