Dow shot up 236, advancers over decliners 5-2 & NAZ gained 58. The MLP index added 3+ to the 258s (still stuck in a sideways pattern) & the REIT index gave back 1 to the 379s. Junk bond funds climbed higher & Treasuries were hit with heavy selling as stocks werre purchased. Oil rose to nearly 61 & gold slid back 2 to 1296.
AMJ (Alerian MLP Index tracking fund
US stocks climb on strong China manufacturing data
US retail sales weak in February, underscore slowing economy
Manufacturing activity rebounds in March, construction spending hits 9-month high in February
Americans are finally tapping the brakes when it comes to buying new vehicles, according to analysis of Q1 sales by JD Power. The firm, which analyzed data from automakers and dealers in the first 3 months of year, estimates the annual sales rate during Q1 was 16.7M vehicles in the US. Depending on the final numbers reported by automakers later this week, the pace of sales during Q1 could be lowest since Q4-2014, when the research firm Autodata calculated a sales rate of 16.69M vehicles. "I think we're starting to see a slowdown," said Dave Habiger, CEO of JD Power. "That said, the consumer remains strong." Most execs in the auto industry have predicted 2019 will be the first year since 2014 when annual sales in the US fall below 17M vehicles. Factors including the number of new vehicles sold in recent years, higher interest rates & higher monthly auto loan payments are expected to prompt some potential buyers to rethink their plans. But JD Power says the end of "peak auto" doesn't mean sales & profits will plunge for automakers. In fact, its data shows the shift from less profitable cars to far more expensive SUVs & pickups, a transition that will help ease the impact of overall sales cooling off. In Q1, 48% of the new vehicles sold were utility vehicles — pickups, SUVs & crossover utility vehicles, an increase of 2% from a year earlier. In addition, the average revenue per utility vehicle collected by automakers in Q1 climbed $800 to $33,100 according to JD Power. The firm's analysis found the average revenue per pickup truck sold in Q1 jumped $1200 to $41,500 over the same time last year. While retail sales of new vehicles fell in Q1, used auto sales at franchise auto dealers continued to climb, increasing 5.3% from the first Q1-2018.
Auto sales projected to slow to lowest level in more than 4 years despite SUV and truck
The stock market began the new month/qtr with the investors bidding up prices. The Dow is well over 26K & closing in on its record high. However, retail sales were not encouraging & much of the economic data for Feb may also be unimpressive. For the time being, the bulls are in command.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund
| CL=F | Crude Oil | 60.76 | +0.62 | +1.0% |
| GC=F | Gold | 1,300.30 | +1.80 | +0.1% |
Stocks began Q2 with robust gains on strong China manufacturing data from two reports. The Chinese gov statistics bureau said its monthly purchasing manufacturers' index (PMI) rose to 50.5 on a 100-point scale on which numbers above 50 show activity rising, up 1.3 points from Fe. Also, China's Caixin/Markit Manufacturing
PMI unexpectedly rose to 50.8 versus forecasts it would hold steady at
49.9. Like the official gov report it's also the first reading
above 50 since Nov, in addition to being the strongest growth since
Mar. Both
reports are easing worries about an economic slowdown in China,
particularly after some recent disappointing data on industrial output. US-Chinese trade talks are due to resume in DC after a round in Beijing last week that Treasury
Secretary Steve Mnuchin described as "constructive." Prospects of a
resolution to the trade conflict between the 2 largest
economies buoyed investor sentiment. Chinese & American officials are aiming to put to rest a dispute over
technology & other issues. Chinese Vice Premier Liu He is expected to
travel to DC next week. Japan's
Nikkei 225 index rose 1.4% to 21,509, easing off earlier
highs after economic data showed conditions for manufacturers
deteriorating. The Shanghai Composite index popped 2.6% to
3170 & Hong Kong's Hang Seng increased 1.7% to 29,554. European
shares were climbing despite bad economic reports there, with Germany's
DAX gaining 1% to 11,645. The CAC40 in Fran advanced 0.5% to 5378 & Britain's FTSE 100 rose 0.6% to 7324.
US stocks climb on strong China manufacturing data
US retail sales unexpectedly fell in Feb, the latest sign economic growth has shifted into low gear as stimulus from $1.5T in tax cuts & increased gov spending fades. The
weak report from the Commerce Dept joined a raft of
other soft data, including housing starts & manufacturing production
that have left economists anticipating a sharp slowdown in growth in Q1. The loss of economic momentum also reflects higher
interest rates, slowing global growth, the trade war with
China & uncertainty over Britain's departure from the EU. These factors contributed to the Federal Reserve's decision last month
to abruptly end its 3-year campaign to tighten monetary policy. The
central bank abandoned projections for any interest rate hikes
this year after increasing borrowing costs 4 times in 2018. Retail
sales dropped 0.2% as households cut back on purchases of
furniture, clothing, food & electronics & appliances, as well as
building materials & gardening equipment. Data for Jan was revised
higher to show retail sales increasing 0.7% instead of gaining
0.2% as previously reported. The forecast called for retail sales rising 0.3% in
Feb. Retail sales in Feb advanced 2.2% from a year ago. The
surprise drop in sales in Feb could partly reflect delays in
processing tax refunds in the middle of the month. Tax refunds have also
been smaller on average compared to prior years following the revamping
of the tax code in Jan 2018. Cold & wet weather could also have
hurt sales. The Feb retail sales report
was delayed by a 35-day partial gov shutdown. Growth estimates for the Jan-Mar qtr are as low as a 0.8% annualized rate. The economy grew at a 2.2% rate in Q4 after expanding at a 3.4% clip in the Q3 period.
US retail sales weak in February, underscore slowing economy
US manufacturing activity rebounded a bit more
than expected in Mar, according to an industry report, as production, new orders & hiring all picked up. The Institute for Supply Management
(ISM) said its index of national factory activity rose to 55.3 from 54.2
in Feb, which had marked the lowest level since Nov 2016. The
reading was slightly above expectations of 54.5. A reading above 50 indicates expansion in the manufacturing sector & a reading below 50 indicates contraction. The employment index rose to 57.5 from 52.3 a month earlier. Expectations called for a reading of 52.4.
The new orders index rose
to 57.4 from 55.5 in Feb. The prices paid index rose to 54.3,
indicating that prices producers are paying for materials rose for the
first time since Dec. Production also picked up, with that index at ticking up to 55.8 from 54.8 the month before. Construction spending increased for a 3rd
straight month, boosted by gains in both private & public
construction projects, offering some good news on the economy following a
string of weak reports. The Commerce Dept
said that construction spending rose 1.0% to a 9-month
high after an upwardly revised 2.5% surge in Jan. The forecast called for construction spending falling 0.2% in
Feb after a previously reported 1.3% jump in Jan. Construction spending increased 1.1% on a year-on-year basis in Feb. Spending on
private construction projects rose 0.2% after vaulting 1.5% in Jan. Investment in private residential projects increased
0.7%, rising for a 3rd straight month. The strong gains are
despite a sluggish housing market, which has been held back by higher
mortgage rates, expensive building materials as well as land & labor
shortages. But there are signs of green shoots emerging in the housing
market as mortgage rates have declined from last year's lofty levels. Spending on private
nonresidential structures, which includes manufacturing & power
plants, fell 0.5% in Feb after jumping 1.1% in
Jan. Investment in public construction projects rose 3.6% after accelerating 5.7% in the prior month. Spending on federal
gov construction projects rose 0.9% to the highest level
since Oct 2017, after soaring 5.7% in Jan. Investment in state & local gov construction projects rose 3.8% after surging 5.7% in Jan.
Manufacturing activity rebounds in March, construction spending hits 9-month high in February
Americans are finally tapping the brakes when it comes to buying new vehicles, according to analysis of Q1 sales by JD Power. The firm, which analyzed data from automakers and dealers in the first 3 months of year, estimates the annual sales rate during Q1 was 16.7M vehicles in the US. Depending on the final numbers reported by automakers later this week, the pace of sales during Q1 could be lowest since Q4-2014, when the research firm Autodata calculated a sales rate of 16.69M vehicles. "I think we're starting to see a slowdown," said Dave Habiger, CEO of JD Power. "That said, the consumer remains strong." Most execs in the auto industry have predicted 2019 will be the first year since 2014 when annual sales in the US fall below 17M vehicles. Factors including the number of new vehicles sold in recent years, higher interest rates & higher monthly auto loan payments are expected to prompt some potential buyers to rethink their plans. But JD Power says the end of "peak auto" doesn't mean sales & profits will plunge for automakers. In fact, its data shows the shift from less profitable cars to far more expensive SUVs & pickups, a transition that will help ease the impact of overall sales cooling off. In Q1, 48% of the new vehicles sold were utility vehicles — pickups, SUVs & crossover utility vehicles, an increase of 2% from a year earlier. In addition, the average revenue per utility vehicle collected by automakers in Q1 climbed $800 to $33,100 according to JD Power. The firm's analysis found the average revenue per pickup truck sold in Q1 jumped $1200 to $41,500 over the same time last year. While retail sales of new vehicles fell in Q1, used auto sales at franchise auto dealers continued to climb, increasing 5.3% from the first Q1-2018.
Auto sales projected to slow to lowest level in more than 4 years despite SUV and truck
The stock market began the new month/qtr with the investors bidding up prices. The Dow is well over 26K & closing in on its record high. However, retail sales were not encouraging & much of the economic data for Feb may also be unimpressive. For the time being, the bulls are in command.
Dow Jones Industrials
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