Economic Data Releases

US economyMy Comments: These data points come from Guggenheim Partners. For some of you this is meaningless nonsense; for others, a quick review is intented to give you a glimpse of what is happening in the world, including the US.

To put some of this in perspective, I saw an article this weekend that compared the results of the DOW Industrial Average, from its theoretical inception in 1817, to now. When Obama became president in 2008, it was roughly 9,000. By the end of this past December, it was roughtly 18,000. The point was it took 190 years to get halfway to where it is now the other half happened since Obama was elected.

My point of this is no President is entitled to the credit for this nor is he entitled to the blame. It generally happens regardless of who is in the White House. However, I urge you to remember that market declines can happen and do happen regardeless of who is in the White House, and happen even when the economy is relatively strong. We are due for a correction.

Continued Strength in Payrolls but Wage Growth Falters
• Non-farm payrolls increased by 252,000 in December after an upwardly revised 353,000 in November.
• The unemployment rate fell by 0.2 percentage points in December to 5.6 percent, in part due to a lower labor force participation rate.
• Average hourly earnings slowed to 1.7 percent year-over-year growth in December, the slowest 12-month rate since October 2012.
• The ISM manufacturing index was weaker than expected in the December reading, falling to 55.5 from 58.7, a six-month low.
• The ISM non-manufacturing index missed expectations in December, falling to a six-month low of 56.2.
• Factory orders dropped in November, down 0.7 percent. Orders have now fallen for four straight months, the first such streak since 2012.
• The S&P/Case-Shiller 20-City Home Price Index showed continued slowing home price growth in October, with the year-over-year reading declining to 4.50 percent from 4.82 percent.
• Pending home sales rose 0.5 percent in November, slightly better than expectations.
• Construction spending fell in November for the first time since June, down 0.3 percent. Public construction spending led the drop.
• The Conference Board’s consumer confidence index ticked up in December, rising to 92.6 from an upwardly revised 91.0. The present situation index experienced a large gain, but expectations fell.
• The trade deficit narrowed in November, contracting to -$39.0 billion, a nearly one-year low.

Euro Zone Enters Deflation

• The euro zone Consumer Price Index fell into deflation in December at -0.2 percent year over year, lower than forecasts had expected. The core CPI inched up to 0.8 percent.
• The euro zone manufacturing Purchasing Managers Index was revised lower in the final December estimate, but still recorded an increase from the prior month at 50.6.
• Euro zone retail sales beat expectations in November, up 0.6 percent for a second consecutive month.
• Germany’s December CPI dropped more than expected on a year-over-year basis, falling to a five-year low of 0.1 percent.
• German industrial production unexpectedly declined in November, down 0.1 percent.
• German exports decreased for a second consecutive month in November, falling 2.1 percent.
• Industrial production in France was down 0.3 percent in November. Production has not risen since July.
• The U.K. manufacturing PMI unexpectedly fell in December, down to 52.5 from 53.3.
• The U.K. services PMI dropped much more than expected in December, falling to a 19-month low of 55.8.
• China’s official manufacturing PMI fell for a third straight month in December, reaching an 18-month low of 50.1.
• China’s non-manufacturing PMI ticked up in December, increasing to a four-month high of 54.1.
• China’s HSBC services PMI ticked up for a second consecutive month in December, reaching a three-month high of 53.4.
• The Chinese Producer Price Index dropped more than expected in December, falling to 3.3 percent year over year.
• Chinese consumer prices inched up in December to 1.5 percent year over year.