Thursday, September 26th, 2024
Pre-markets are up after taking a breather on most indexes Wednesday. A plethora of new economic data has hit the tape this morning, and none of it has caused an unraveling in the gains made so far — ultimately, this is a good sign.
The Dow is up +195 points this morning, looking to work its way back to all-time closing highs it had enjoyed as recently as earlier this week. Same with the S&P 500, which is up +47 points at this hour. The Nasdaq is +311 points, and is the only index to have eked out gains yesterday.
Final Revision on Q2 GDP: 3.0%
The verdict is in on
Q2 Gross Domestic Product (GDP) this morning, with the second and final revision in the books at +3.0%. This more than doubles the weak +1.4% made in Q1, and 40 basis points (bps) below the +3.4% from Q4 of 2023. In the eight quarters since the last negative quarter of GDP, Q2 2022, we’ve averaged +2.7% in economic growth.
Consumption levels dipped 10 bps from the previous revision to +2.8%. The Price Index remained steady with the prior read at +2.5%. PCE core, quarter over quarter, reached +2.8%. All of these are the highest figures since Q4 ’23.
Weekly Jobless Claims Steady to Lower
Initial Jobless Claims dipped to +218K last week, below the +223K expected and the upwardly revised +222K, and the lowest level of new weekly jobless claims from mid-May. In terms of growing concerns about the labor market, new jobless claims remain very healthy.
We haven’t had a +250K week of new claims since August of last year. Much of this phenomenon in jobless claims may have to do with retirees in the labor market: the youngest Baby Boomers are now turning retirement age, and even some Gen-Xers are taking early retirement. Because in other labor force figures, we do see declines in overall employment,
Continuing Claims were also tame at 1.834 million, up from the downwardly revised 1.821 million the prior week, which was the lowest weekly print since early June. That said, it is the 16th straight week above 1.8 million longer-term jobless claims. This isn’t a problem in itself — not until we start seeing longer-term claims at 2 million or higher will there be any real concern — but there looks to be a floor on continuing jobless filings.
Durable Goods Unched for August
Preliminary
Durable Goods Orders for August came in at 0.0%, better than the -3.0% expected on this rather volatile set of data. The previous month was upwardly revised to +9.9%, the highest figure since July of 2020. That said, as preliminary results, we do expect a possible revision to the headline number in the future.
Strip out Transportation and we see this number grow to +0.5% from an upwardly revised -0.1% the prior month. Non-Defense, ex-aircraft orders swung to +0.2% from -0.1% in July, with Shipments coming in at +0.1%. These figures are in-line with expectations, and not reflective of any notable sore spots in the economy.
After the Stock Market Opens: Pending Home Sales, FedSpeak
Pending Home Sales for August are expected to tick up +1.0% from a -5.5% drop the prior month. These follow yesterday’s better-than-expected New Home Sales, which were still lower month over month. We look at these numbers as placeholders ahead of impacts from lower interest rates in the future leading to lower mortgage rates, and thus more activity in the home-buying market.
Also, now more than a week after the Fed began a new rate cut cycle for the first time since the pandemic, we’ll hear from Fed Governors Michelle Bowman and Lisa Cook, Vice Chair Michael Barr, Fed Chair Jerome Powell and two Fed Presidents — Minnesota’s Kashkari and New York’s Williams — about the state of monetary policy and what to expect going forward.
Questions or comments about this article and/or author? Click here>>
Image: Bigstock
Jobless Claims 218K, Q2 GDP +3.0%, Durable Goods Unchanged
Thursday, September 26th, 2024
Pre-markets are up after taking a breather on most indexes Wednesday. A plethora of new economic data has hit the tape this morning, and none of it has caused an unraveling in the gains made so far — ultimately, this is a good sign.
The Dow is up +195 points this morning, looking to work its way back to all-time closing highs it had enjoyed as recently as earlier this week. Same with the S&P 500, which is up +47 points at this hour. The Nasdaq is +311 points, and is the only index to have eked out gains yesterday.
Final Revision on Q2 GDP: 3.0%
The verdict is in on Q2 Gross Domestic Product (GDP) this morning, with the second and final revision in the books at +3.0%. This more than doubles the weak +1.4% made in Q1, and 40 basis points (bps) below the +3.4% from Q4 of 2023. In the eight quarters since the last negative quarter of GDP, Q2 2022, we’ve averaged +2.7% in economic growth.
Consumption levels dipped 10 bps from the previous revision to +2.8%. The Price Index remained steady with the prior read at +2.5%. PCE core, quarter over quarter, reached +2.8%. All of these are the highest figures since Q4 ’23.
Weekly Jobless Claims Steady to Lower
Initial Jobless Claims dipped to +218K last week, below the +223K expected and the upwardly revised +222K, and the lowest level of new weekly jobless claims from mid-May. In terms of growing concerns about the labor market, new jobless claims remain very healthy.
We haven’t had a +250K week of new claims since August of last year. Much of this phenomenon in jobless claims may have to do with retirees in the labor market: the youngest Baby Boomers are now turning retirement age, and even some Gen-Xers are taking early retirement. Because in other labor force figures, we do see declines in overall employment,
Continuing Claims were also tame at 1.834 million, up from the downwardly revised 1.821 million the prior week, which was the lowest weekly print since early June. That said, it is the 16th straight week above 1.8 million longer-term jobless claims. This isn’t a problem in itself — not until we start seeing longer-term claims at 2 million or higher will there be any real concern — but there looks to be a floor on continuing jobless filings.
Durable Goods Unched for August
Preliminary Durable Goods Orders for August came in at 0.0%, better than the -3.0% expected on this rather volatile set of data. The previous month was upwardly revised to +9.9%, the highest figure since July of 2020. That said, as preliminary results, we do expect a possible revision to the headline number in the future.
Strip out Transportation and we see this number grow to +0.5% from an upwardly revised -0.1% the prior month. Non-Defense, ex-aircraft orders swung to +0.2% from -0.1% in July, with Shipments coming in at +0.1%. These figures are in-line with expectations, and not reflective of any notable sore spots in the economy.
After the Stock Market Opens: Pending Home Sales, FedSpeak
Pending Home Sales for August are expected to tick up +1.0% from a -5.5% drop the prior month. These follow yesterday’s better-than-expected New Home Sales, which were still lower month over month. We look at these numbers as placeholders ahead of impacts from lower interest rates in the future leading to lower mortgage rates, and thus more activity in the home-buying market.
Also, now more than a week after the Fed began a new rate cut cycle for the first time since the pandemic, we’ll hear from Fed Governors Michelle Bowman and Lisa Cook, Vice Chair Michael Barr, Fed Chair Jerome Powell and two Fed Presidents — Minnesota’s Kashkari and New York’s Williams — about the state of monetary policy and what to expect going forward.
Questions or comments about this article and/or author? Click here>>