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Trade Balance Comes in Lower but Better Than Expected
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We enter the final trading day of the month of February looking at a down month overall, following January’s positive bounce off December’s relative plummet. Pre-market futures are in the green, but similar to where we closed yesterday: up, but underwhelmingly so. The Dow, which had been +79 points earlier in the early session, are +54 points now. The Nasdaq had dwindled from +18 points to +10 and the S&P 500 has stayed relatively steady, currently +5 points.
The January U.S. Trade Balance in Goods came in lower month over month, but better than expected — based on a nice upward revision to the previous month. Today’s headline was a deficit of -$90.5 billion, which would have been a slight improvement over December’s originally reported -$90.6 billion. But that month’s revision takes it to -$87.7 billion — still economically challenging, but well better than when we crashed through the -$100 billion floor in March of last year.
Advance Retail Inventories for January came in lighter than expected: +0.3% versus a downwardly revised +0.4% (originally +0.7%). Advance Wholesale Inventories for the same month reached a negative -0.4% from an unrevised +0.1% the previous month. These are inflation reads on a smaller scale than, say, CPI or PCE, but these increments may point the way forward in some of the bigger metrics. Inventories are being worked down; this will need to be rectified in the overall supply/demand equation over time.
December Case-Shiller Home Price Index data is also out this morning, with overall 20-city prices +5.8% year over year, well down from November’s +7.6% and thankfully far removed from the painful peak of +10.2% last June. Also, +5.8% is a major softening from the all-time high reported for December of 2021, which was +18.9%. As we saw in Pending Home Sales data yesterday, the clearest sign of higher interest rates having a direct impact on the U.S. economy is in housing prices, with mortgage rates now averaging up towards 7% once again.
Finally, Target (TGT - Free Report) is out with Q4 earnings this morning, easily surpassing earnings estimates by 50 cents per share to $1.89, a +36% positive surprise. Revenues of $31.4 billion in the quarter outpaced the Zacks consensus by +2.29%. The big-box retailer still has a ways to go to reach the year-ago quarter’s earnings of $3.19 per share, but considering the challenges, we’d say this was a successful quarter. Target shares have gained +12% year to date, and are up marginally in pre-market trading on the news.
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Trade Balance Comes in Lower but Better Than Expected
We enter the final trading day of the month of February looking at a down month overall, following January’s positive bounce off December’s relative plummet. Pre-market futures are in the green, but similar to where we closed yesterday: up, but underwhelmingly so. The Dow, which had been +79 points earlier in the early session, are +54 points now. The Nasdaq had dwindled from +18 points to +10 and the S&P 500 has stayed relatively steady, currently +5 points.
The January U.S. Trade Balance in Goods came in lower month over month, but better than expected — based on a nice upward revision to the previous month. Today’s headline was a deficit of -$90.5 billion, which would have been a slight improvement over December’s originally reported -$90.6 billion. But that month’s revision takes it to -$87.7 billion — still economically challenging, but well better than when we crashed through the -$100 billion floor in March of last year.
Advance Retail Inventories for January came in lighter than expected: +0.3% versus a downwardly revised +0.4% (originally +0.7%). Advance Wholesale Inventories for the same month reached a negative -0.4% from an unrevised +0.1% the previous month. These are inflation reads on a smaller scale than, say, CPI or PCE, but these increments may point the way forward in some of the bigger metrics. Inventories are being worked down; this will need to be rectified in the overall supply/demand equation over time.
December Case-Shiller Home Price Index data is also out this morning, with overall 20-city prices +5.8% year over year, well down from November’s +7.6% and thankfully far removed from the painful peak of +10.2% last June. Also, +5.8% is a major softening from the all-time high reported for December of 2021, which was +18.9%. As we saw in Pending Home Sales data yesterday, the clearest sign of higher interest rates having a direct impact on the U.S. economy is in housing prices, with mortgage rates now averaging up towards 7% once again.
Finally, Target (TGT - Free Report) is out with Q4 earnings this morning, easily surpassing earnings estimates by 50 cents per share to $1.89, a +36% positive surprise. Revenues of $31.4 billion in the quarter outpaced the Zacks consensus by +2.29%. The big-box retailer still has a ways to go to reach the year-ago quarter’s earnings of $3.19 per share, but considering the challenges, we’d say this was a successful quarter. Target shares have gained +12% year to date, and are up marginally in pre-market trading on the news.