Small Caps and Energy powered ahead this week- SP600 up over 3.5% outperforming large everything, including tech. Energy gained almost 5% as both Brent and West Texas crude closed at post-COVIDhighs of 62$ and 59$ respectively.
The Baker Hughes rig count gained 5 this week. There are 397 oil and gas rigs operating in the US – down 393 over last year.
Brent Crude Oil gained 4.71% this week closing at $62.43/bbl
WTI Crude Oil gained 4.61% this week to close at $59.47/bbl
Heating Oil gained 3.37% this week closing at $1.77/gallon
Natural Gas gained 1.71% this week closing at $2.91 per million BTUs
Unleaded Gas gained 9.98% this week closing at $1.81/gallon
Metals Complex
Gold gained 0.56% this week closing at $1823.20/oz
Silver gained 1.14% on the week closing at $27.33/oz
Palladium gained 2.42% this week closing at $2382.60/oz
Platinum gained 11.12% this week closing at $1259.00/oz
Copper gained 4.47% this week closing at $3.79/lb
Employment Picture
Weekly Unemployment Claims – Released Thursday 2/11/2021 – Initial jobless claims for the week ending February 6th decreased 19k to 793k. The 4-week moving average was 823k, a decrease of 33.5k.
Job Openings & Labor Turnover Survey JOLTS – Released 2/9/2021 – The U.S. Bureau of Labor Statistics reported the number and rate of job openings was little changed at 6.6 million on the last business day of December. Over the month, hires decreased to 5.5 million and separations increased to 5.5 million. Within separations, the quits rate was little changed at 2.3%. The layoffs and discharges rates was little changed at 1.3%.
January Jobs Report–BLS Summary– Released 2/5/2021 – The US Economyadded 49k nonfarm jobs in January and the Unemployment rate was fell 0.4% to 6.3%. Average hourly earnings increased 6 cents to $29.96. Hiring highlights include +97k Professional and Business Services, +43 Government, -61 Leisure and Hospitality.
Average hourly earnings increased 6 cents to $29.96.
U3 unemployment rate fell 0.4% to 6.3%. U6 unemployment rate declined to 11.1%.
The labor force participation rate was unchanged 61.4%.
Average work week increased by 0.3 hour to 35 hours.
Employment Cost Index – Released 1/29/2021 – Compensation costs for civilian workers increased 0.7% for the 3-month period ending in December 2020. The 12 month period ending on December 2020 saw compensation costs increase by 2.5%. The 12 month period ending December 2019 increased 2.7%. Wages and salaries increased 2.6 percent over the year and increased 2.9 percent for the 12-month period ending in December 2019. Benefit costs increased 2.1 percent for the 12-month period ending in December 2020. In December 2019, benefit costs increased 1.9 percent. This report is published quarterly.
This Week’s Economic Data
Links take you to the data source
Consumer Price Index –Released 2/10/2021 – The Consumer Price Index increased 0.3% in January. Core CPI, which excludes food and energy was flat. The monthly changes left total CPI up 1.4% year-over-year and core CPI up 1.4%.
Recent Economic Data
Links take you to the data source
Consumer Credit–Released 2/5/2021 – In December, consumer credit increased at a seasonally adjusted rate of 2.8%. For 2020 revolving credit decreased at an annual rate of 11.2%, while nonrevolving credit increased at an annual rate of 3.9%. Total Outstanding consumer credit is currently at $4.1842 trillion.
U.S. Trade Balance–Released 2/5/2021 –According to the U.S. Census Bureau of Economic Analysis the goods and services deficit increased in December by $2.4 billion to $66.6 billion. December exports were $190.0 billion, $6.2 billion more than November exports. December imports were $256.6 billion, $3.8 billion more than November imports. In 2020 the goods and services deficit increased $101.9 billion or 17.7% year-to-date, from the same period in 2019. Year – over – year exports and imports decreased $396.4 billion or 15.7% and decreased $294.5 billion or 9.5% respectively.
PMI Non-Manufacturing Index–Released 2/3/2021 – Economic activity in the non-manufacturing sector grew in January for the eighth consecutive month. ISM Non-Manufacturing registered 58.7 percent, which is 1.0 percentage points above the adjusted December reading of 57.7 percent.
PMI Manufacturing Index – Released 2/1/2021 – January PMI declined 1.8% to 58.7% from December’s reading of 60.5%. The New Orders Index was down 6.4% from December’s reading of 67.5% to 61.1%. The Production Index registered 60.7%, down 4.0%.
U.S. Construction Spending– Released 2/1/2021 – Construction spending increased 1.0% in December measuring at a seasonally adjusted annual rate of $1,490.4 billion. The December figure is 5.7% above the December 2019 estimate. Private construction spending was 1.2% above the revised November estimate at $1,137.6 billion. Public construction spending was 0.5% above the revised November estimate at $352.8 billion.
US Light Vehicle Sales – Released 1/29/2021 – U.S. light vehicle sales were at a seasonally adjusted annual rate (SAAR) of 16.270 million units in December.
Chicago PMI– Released 1/29/2021 – Chicago PMI increased to 63.8 points in January. This is the highest level since July 2018 and marks seven consecutive months above the 50-mark following a full year under it. Among the main five indicators, Production saw the largest monthly gain, followed by New Orders. Employment recorded the biggest decline.
Personal Income– Released 1/29/2021 – Personal income increased $116.6 billion or 0.6 percent in December according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $111.6 billion or 0.6 percent and personal consumption expenditures (PCE) decreased $27.9 billion or 0.2 percent.
New Residential Sales– Released 1/28/2021 – Sales of new single-family homes increased 1.6% to 842k, seasonally adjusted, in December. The median sales price of new homes sold in December was $355,900 with an average sales price of $394,900. At the end of December the seasonally adjusted estimate of new homes for sale was 302k. This represents a supply of 4.3 months at the current sales rate.
Advance Estimate of 4th Quarter 2020 GDP – Released 1/28/2021 – Real gross domestic product (GDP) increased at an annual rate of 4.0 percent in the fourth quarter of 2020, according to the advance estimate released by the Bureau of Economic Analysis. The third quarter of 2020 saw an increase of 33.4 percent in real GDP. The increase in real GDP reflected increases in exports, nonresidential fixed investment, personal consumption expenditures (PCE), residential fixed investment, and private inventory investment that were partly offset by decreases in state and local government spending and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.
Durable Goods– Released 1/27/2021 – New orders for manufactured durable goods in December increased for the eighth consecutive month up $0.4 billion or 0.2% to $245.3 billion. Machinery led the increase rising $0.8 billion or 2.4% to $33.2 billion.
Consumer Confidence– Released 1/26/2021 – The Consumer confidence index increased 2.53% in January following a decline in December. The Index now shows a reading of 89.3, up from 87.1 in December.
Existing Home Sales– Released 1/22/2020 – Existing home sales increased in December. Sales increased 0.7% to a seasonally adjusted rate of 6.76 million in December. Sales are currently up 22.2% from one year ago. Housing inventory sits at 1.07 million units. Down 16.4% over last month. Down 23% over last year. Unsold inventory sits at an all-time low 1.9 month supply. The median existing home price for all housing types was $309,800.
Housing Starts– Released 1/21/2021 – New home starts in December were at a seasonally adjusted annual rate of 1.669 million; up 5.8% above November and 5.2% above last December’s rate. Building Permits were at a seasonally adjusted annual rate of 1.709 million, up 4.5% compared to November and up 17.3% over last year.
Retail Sales – Released 1/15/2021 – U.S. retail sales for December decreased 0.7% to $540.9 billion. U.S. retail sales are up 2.9% year/y.
Industrial Production and Capacity Utilization – Released 1/15/2021 – In DecemberIndustrial production increased 1.6%. Total Industrial production is still 3.3% below its pre-pandemic February level. Manufacturing increased 0.9%. Mining increased 1.6%. Utilities increased 6.2%. Total industrial production was 105.7% of its 2012 average which is 3.6% lower in December than a year ago. Total capacity utilization increased 1.1% to 74.5% in December which is 5.3% below its long run average.
Producer Price Index–Released 1/15/2021 – The Producer Price Index for final demand increased 0.3% in December. PPI less food and energy increased 0.5% in December.
Next week we get data on PPI, Industrial Production and Capacity Utilization, Retail Sales, Housing Starts, and Existing Home Sales.
New Cases Continue to Drop – More All Time Highs
COVID data continues to be positive. New cases are down to 90k from 113k last week – hospitalizations are down to 64k from 84k last week.
https://covidtracking.com/data/charts/us-all-key-metrics
Small Caps and Energy powered ahead this week- SP600 up over 3.5% outperforming large everything, including tech. Energy gained almost 5% as both Brent and West Texas crude closed at post-COVIDhighs of 62$ and 59$ respectively.
Table of Contents
Fixed Income
12/16/20 FOMC Statement FOMC Minutes Credit, Liquidity and Balance Sheet Federal Reserve Dot Plots US Debt Measurement US Corporate Debt Tops 7 Trillion Treasury.gov yields FOMC Policy Normalization Statement Longer Run Goals August 2020
Global Bond Yields
Daily US Treasury Yields
Foreign Exchange Market
Energy Complex
The Baker Hughes rig count gained 5 this week. There are 397 oil and gas rigs operating in the US – down 393 over last year.
Metals Complex
Employment Picture
Weekly Unemployment Claims – Released Thursday 2/11/2021 – Initial jobless claims for the week ending February 6th decreased 19k to 793k. The 4-week moving average was 823k, a decrease of 33.5k.
Job Openings & Labor Turnover Survey JOLTS – Released 2/9/2021 – The U.S. Bureau of Labor Statistics reported the number and rate of job openings was little changed at 6.6 million on the last business day of December. Over the month, hires decreased to 5.5 million and separations increased to 5.5 million. Within separations, the quits rate was little changed at 2.3%. The layoffs and discharges rates was little changed at 1.3%.
January Jobs Report – BLS Summary – Released 2/5/2021 – The US Economy added 49k nonfarm jobs in January and the Unemployment rate was fell 0.4% to 6.3%. Average hourly earnings increased 6 cents to $29.96. Hiring highlights include +97k Professional and Business Services, +43 Government, -61 Leisure and Hospitality.
Employment Cost Index – Released 1/29/2021 – Compensation costs for civilian workers increased 0.7% for the 3-month period ending in December 2020. The 12 month period ending on December 2020 saw compensation costs increase by 2.5%. The 12 month period ending December 2019 increased 2.7%. Wages and salaries increased 2.6 percent over the year and increased 2.9 percent for the 12-month period ending in December 2019. Benefit costs increased 2.1 percent for the 12-month period ending in December 2020. In December 2019, benefit costs increased 1.9 percent. This report is published quarterly.
This Week’s Economic Data
Links take you to the data source
Consumer Price Index – Released 2/10/2021 – The Consumer Price Index increased 0.3% in January. Core CPI, which excludes food and energy was flat. The monthly changes left total CPI up 1.4% year-over-year and core CPI up 1.4%.
Recent Economic Data
Links take you to the data source
Consumer Credit – Released 2/5/2021 – In December, consumer credit increased at a seasonally adjusted rate of 2.8%. For 2020 revolving credit decreased at an annual rate of 11.2%, while nonrevolving credit increased at an annual rate of 3.9%. Total Outstanding consumer credit is currently at $4.1842 trillion.
U.S. Trade Balance – Released 2/5/2021 – According to the U.S. Census Bureau of Economic Analysis the goods and services deficit increased in December by $2.4 billion to $66.6 billion. December exports were $190.0 billion, $6.2 billion more than November exports. December imports were $256.6 billion, $3.8 billion more than November imports. In 2020 the goods and services deficit increased $101.9 billion or 17.7% year-to-date, from the same period in 2019. Year – over – year exports and imports decreased $396.4 billion or 15.7% and decreased $294.5 billion or 9.5% respectively.
PMI Non-Manufacturing Index – Released 2/3/2021 – Economic activity in the non-manufacturing sector grew in January for the eighth consecutive month. ISM Non-Manufacturing registered 58.7 percent, which is 1.0 percentage points above the adjusted December reading of 57.7 percent.
PMI Manufacturing Index – Released 2/1/2021 – January PMI declined 1.8% to 58.7% from December’s reading of 60.5%. The New Orders Index was down 6.4% from December’s reading of 67.5% to 61.1%. The Production Index registered 60.7%, down 4.0%.
U.S. Construction Spending – Released 2/1/2021 – Construction spending increased 1.0% in December measuring at a seasonally adjusted annual rate of $1,490.4 billion. The December figure is 5.7% above the December 2019 estimate. Private construction spending was 1.2% above the revised November estimate at $1,137.6 billion. Public construction spending was 0.5% above the revised November estimate at $352.8 billion.
US Light Vehicle Sales – Released 1/29/2021 – U.S. light vehicle sales were at a seasonally adjusted annual rate (SAAR) of 16.270 million units in December.
Chicago PMI – Released 1/29/2021 – Chicago PMI increased to 63.8 points in January. This is the highest level since July 2018 and marks seven consecutive months above the 50-mark following a full year under it. Among the main five indicators, Production saw the largest monthly gain, followed by New Orders. Employment recorded the biggest decline.
Personal Income – Released 1/29/2021 – Personal income increased $116.6 billion or 0.6 percent in December according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $111.6 billion or 0.6 percent and personal consumption expenditures (PCE) decreased $27.9 billion or 0.2 percent.
New Residential Sales – Released 1/28/2021 – Sales of new single-family homes increased 1.6% to 842k, seasonally adjusted, in December. The median sales price of new homes sold in December was $355,900 with an average sales price of $394,900. At the end of December the seasonally adjusted estimate of new homes for sale was 302k. This represents a supply of 4.3 months at the current sales rate.
Advance Estimate of 4th Quarter 2020 GDP – Released 1/28/2021 – Real gross domestic product (GDP) increased at an annual rate of 4.0 percent in the fourth quarter of 2020, according to the advance estimate released by the Bureau of Economic Analysis. The third quarter of 2020 saw an increase of 33.4 percent in real GDP. The increase in real GDP reflected increases in exports, nonresidential fixed investment, personal consumption expenditures (PCE), residential fixed investment, and private inventory investment that were partly offset by decreases in state and local government spending and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.
Durable Goods – Released 1/27/2021 – New orders for manufactured durable goods in December increased for the eighth consecutive month up $0.4 billion or 0.2% to $245.3 billion. Machinery led the increase rising $0.8 billion or 2.4% to $33.2 billion.
Consumer Confidence – Released 1/26/2021 – The Consumer confidence index increased 2.53% in January following a decline in December. The Index now shows a reading of 89.3, up from 87.1 in December.
Existing Home Sales – Released 1/22/2020 – Existing home sales increased in December. Sales increased 0.7% to a seasonally adjusted rate of 6.76 million in December. Sales are currently up 22.2% from one year ago. Housing inventory sits at 1.07 million units. Down 16.4% over last month. Down 23% over last year. Unsold inventory sits at an all-time low 1.9 month supply. The median existing home price for all housing types was $309,800.
Housing Starts – Released 1/21/2021 – New home starts in December were at a seasonally adjusted annual rate of 1.669 million; up 5.8% above November and 5.2% above last December’s rate. Building Permits were at a seasonally adjusted annual rate of 1.709 million, up 4.5% compared to November and up 17.3% over last year.
Retail Sales – Released 1/15/2021 – U.S. retail sales for December decreased 0.7% to $540.9 billion. U.S. retail sales are up 2.9% year/y.
Industrial Production and Capacity Utilization – Released 1/15/2021 – In December Industrial production increased 1.6%. Total Industrial production is still 3.3% below its pre-pandemic February level. Manufacturing increased 0.9%. Mining increased 1.6%. Utilities increased 6.2%. Total industrial production was 105.7% of its 2012 average which is 3.6% lower in December than a year ago. Total capacity utilization increased 1.1% to 74.5% in December which is 5.3% below its long run average.
Producer Price Index – Released 1/15/2021 – The Producer Price Index for final demand increased 0.3% in December. PPI less food and energy increased 0.5% in December.
Next week we get data on PPI, Industrial Production and Capacity Utilization, Retail Sales, Housing Starts, and Existing Home Sales.
Data Sources:
Bureau of Economic Analysis (BEA)
Congressional Budget Office (CBO)
U.S. Bureau of Labor Statistics (BLS)
Federal Reserve Economic Data (FRED Charts)
CME Fed Watch
U.S. Treasury – Yields
U.S. Census Bureau
Institute for Supply Management (ISM)
Weekly DOL Employment Data
BLS Monthly Jobs Report
JOLTS
US Energy Admin (EIA)
BLS Consumer Price Index CPI
BLS Producer Price Index PPI
Atlanta Fed GDPNOW
NY Fed Nowcast GDP
US Census Bureau Housing Starts
Consumer Credit
USCB Retail Sales
Construction Spending
Federal Reserve Dot Plots
NY Empire Index
Philadelphia Federal Reserve
P/E Ratio Data -Yardeni Research
Technical Analysis Info:
StockCharts.com – Financial Charts
Exponential vs Simple moving average
Other Links:
1973 Arab Oil Embargo
Hunt Brothers Silver
Long-Term Capital bailout
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