New economic data released before today’s opening bell has taken market indexes from the green to the red this morning, with a big miss on February Retail Sales numbers going from an expected -0.1% to -3.0%. Subtracting volatile auto sales, it doesn’t get much better: -2.7%. Ex-autos and gas reached -3.3%, while the Control number fell 3.5%, the furthest since the deep crevasse of the initial pandemic impact in April of last year came in at -12.4%.
Winter storms from Texas to the Northeast hit the consumer economy last month, with Furniture and Electronics sales, among others, lower month over month. But another key was the burn-off of the December stimulus package, and this can be seen in the big revisions to January Retail Sales figures: the headline revision went from +5.3% originally reported to +7.6% this time around, with ex-autos moving from +5.9%, already impressive, to an eyebrow-raising +8.3% on the revision.
This is important to keep in mind with new stimulus checks hitting Americans’ bank accounts this week: if the $900 billion Covid relief bill passed late last year prodded the initial month of Q1 up 7-8%+, what can we expect a $1.9 trillion package to yield? Already we’re seeing travel bookings up 14% week over week; can electronics and furniture purchases be much farther behind?
Import Prices for February came in slightly hotter than expected: +1.3% from the expected +1.1%. It’s down 10 basis points from January’s unrevised +1.4%, which represents the cycle high. Subtracting petrol costs, +0.5% was the figure, down from the +0.9% the previous month. We’re seeing +3% Import Price growth year over year — a nice, healthy, round number. Exports also surprised to the upside: +1.6% versus +0.9%.
Finally, Industry Production for February were also negatively affected by weather conditions and supply constraints, missing estimates by a wide margin. Expected to come in positive at 0.5%, though down from the initially reported +0.9% in January, comes in at -2.2%, the lowest monthly print since April 2020’s all-time low -12.7%. The revision for the previous month bumped up to +1.1%.
Capacity Utilization also posted a big miss: 73.8% is not only 200 basis points off expectations, but historically low in the amount of goods-producing usage. Pre-pandemic, we’d seen these numbers routinely in the high-70s. January’s figure was notched down slightly to 75.5%. Again, we can expect a turnaround at some point of the new stimulus giving a shot in the arm to the economy at large, not to mention all those shots in the arm immunizing Americans from the coronavirus.
Today also marks the one-year anniversary of the bottom falling out of the stock market. What had been a tepid but steady recovery up until corporate taxes being slashed in early 2018, at which point growth began ramping up at a stronger clip before the U.S.-China trade war muted some of the growth, was depleted in a blink of an eye on March 16, 2020. News reports that the coronavirus pandemic might last until August 2020 — oh, such innocence! — caused a tsunami of equities selling which erupted across all industries.
Image: Bigstock
Economic Data Deluge
New economic data released before today’s opening bell has taken market indexes from the green to the red this morning, with a big miss on February Retail Sales numbers going from an expected -0.1% to -3.0%. Subtracting volatile auto sales, it doesn’t get much better: -2.7%. Ex-autos and gas reached -3.3%, while the Control number fell 3.5%, the furthest since the deep crevasse of the initial pandemic impact in April of last year came in at -12.4%.
Winter storms from Texas to the Northeast hit the consumer economy last month, with Furniture and Electronics sales, among others, lower month over month. But another key was the burn-off of the December stimulus package, and this can be seen in the big revisions to January Retail Sales figures: the headline revision went from +5.3% originally reported to +7.6% this time around, with ex-autos moving from +5.9%, already impressive, to an eyebrow-raising +8.3% on the revision.
This is important to keep in mind with new stimulus checks hitting Americans’ bank accounts this week: if the $900 billion Covid relief bill passed late last year prodded the initial month of Q1 up 7-8%+, what can we expect a $1.9 trillion package to yield? Already we’re seeing travel bookings up 14% week over week; can electronics and furniture purchases be much farther behind?
Import Prices for February came in slightly hotter than expected: +1.3% from the expected +1.1%. It’s down 10 basis points from January’s unrevised +1.4%, which represents the cycle high. Subtracting petrol costs, +0.5% was the figure, down from the +0.9% the previous month. We’re seeing +3% Import Price growth year over year — a nice, healthy, round number. Exports also surprised to the upside: +1.6% versus +0.9%.
Finally, Industry Production for February were also negatively affected by weather conditions and supply constraints, missing estimates by a wide margin. Expected to come in positive at 0.5%, though down from the initially reported +0.9% in January, comes in at -2.2%, the lowest monthly print since April 2020’s all-time low -12.7%. The revision for the previous month bumped up to +1.1%.
Capacity Utilization also posted a big miss: 73.8% is not only 200 basis points off expectations, but historically low in the amount of goods-producing usage. Pre-pandemic, we’d seen these numbers routinely in the high-70s. January’s figure was notched down slightly to 75.5%. Again, we can expect a turnaround at some point of the new stimulus giving a shot in the arm to the economy at large, not to mention all those shots in the arm immunizing Americans from the coronavirus.
Today also marks the one-year anniversary of the bottom falling out of the stock market. What had been a tepid but steady recovery up until corporate taxes being slashed in early 2018, at which point growth began ramping up at a stronger clip before the U.S.-China trade war muted some of the growth, was depleted in a blink of an eye on March 16, 2020. News reports that the coronavirus pandemic might last until August 2020 — oh, such innocence! — caused a tsunami of equities selling which erupted across all industries.