Global Markets Update S&P 500 EPS unlikely to keep outpacing “macro” profits The profits of Corporate America have shrunk during the past four years according to revised estimates recently published by the US Bureau of Economic Analysis (BEA). By contrast, S&P 500 operating... 5th August 2019 · 5 mins read
US Economics Weekly Trump ramps up pressure on the Fed Despite cutting rates by 25bp this week, the Fed gave no indication that it is lining up another cut soon or that this will mark the start of the extended easing cycle investors are hoping for. But... 2nd August 2019 · 6 mins read
US Data Response Employment Report (Jul.) The 164,000 gain in non-farm payrolls in July confirms that employment growth is trending lower, but it also suggests that the economy is still coping reasonably well amidst concerns over weaker... 2nd August 2019 · 2 mins read
US Housing Market Update What’s driving the gap between mortgages and sales? The number of mortgage applications for home purchase jumped earlier this year, but those buyers came up against the tightest market conditions for 40-years. Increased competition for homes crowded... 2nd August 2019 · 3 mins read
US Economics Update Trump brings trade tensions back to boiling point The announcement by President Donald Trump of further tariffs on Chinese imports has rattled the markets, but we have long suspected that it was only a matter of time before the trade dispute... 2nd August 2019 · 4 mins read
US Data Response ISM Manufacturing Index (Jul.) The further decline in the ISM manufacturing index to a three-year low of 51.2 in July, from 51.7, confirms that the downturn in the factory sector continued into the third quarter, and suggests that... 1st August 2019 · 2 mins read
US Economics Update Fed lowers rates by 25bp, but in no rush to cut again The Fed reduced the fed funds rate by 25bp — to between 2.00% and 2.25% — at today’s FOMC meeting, but it was arguably a “hawkish” rather than “dovish” cut, which supports our view that the next... 31st July 2019 · 3 mins read
US Economics Update Is core inflation about to surprise on the upside? The rebound in the three-month annualised rate of core PCE inflation to a seven-year high of 2.5% in June, together with evidence that unit labour costs have been rising more rapidly than thought... 30th July 2019 · 2 mins read
US Housing Market Data Response Case-Shiller House Prices (May) Annual house price growth edged back once again in May, with subdued demand and lender caution taking some of the heat out of the market. That slowdown is set to continue as the economy weakens, but... 30th July 2019 · 2 mins read
US Economics Update 737 Max woes will continue to weigh on GDP growth The grounding of the Boeing 737 Max aircraft delivered a hit to business equipment investment and net exports in the second quarter, reducing annualised GDP growth by 0.25% points. A similar hit to... 29th July 2019 · 2 mins read
US Economics Weekly 25bp rate cut may not go down well in the markets The Fed is likely to cut interest rates by 25bp at next week’s FOMC meeting. Despite the stronger-than-expected GDP data released on Friday, however, fed funds futures still put the odds of a larger... 26th July 2019 · 7 mins read
US Data Response GDP (Q2) Second-quarter GDP growth slowed to 2.1% annualised, from 3.1% in the first, but that drop off would have been even bigger if not for a surprisingly strong gain in government expenditure. In short... 26th July 2019 · 2 mins read
US Housing Market Update Drop in homeownership rate won’t be reversed soon A steady decline in home sales last year pushed the homeownership rate to a 1½-year low in the second quarter, and we doubt it will recover over the next couple of years. A slowing economy will... 26th July 2019 · 3 mins read
US Employment Report Preview Labour market conditions beginning to sour Our model points to a renewed slowdown in payroll employment growth in July to just 145,000, from 224,000. As the economy slows further, we expect a more marked downturn in employment growth later... 25th July 2019 · 3 mins read
US Data Response Durable Goods & Advance Economic Indicators (Jun.) The surge in durable goods orders in June suggests that business equipment investment is holding up a bit better than we anticipated. But with the incoming global data still deteriorating and domestic... 25th July 2019 · 2 mins read
US Housing Market Data Response New Home Sales (Jun.) New home sales rose by a solid 7.0% m/m in June, making up some of the ground they lost over April and May. A healthy new home inventory will continue to support sales, but the dip in mortgage... 24th July 2019 · 2 mins read
