The Daily Shot: 04-Sep-24
• The United States
• Canada
• The Eurozone
• Europe
• Asia-Pacific
• China
• Emerging Markets
• Commodities
• Energy
• Equities
• Credit
• Food for Thought
The United States
1. The ISM Manufacturing PMI indicated continued contraction in US factory activity in August (PMI < 50), …
… as demand deteriorates.
• Here are the contributions to the headline index.
• The ISM orders-inventories spread suggests further weakening in the coming months.
Source: @TheTerminal, Bloomberg Finance L.P.
• Factories continue to reduce staff, …
… which is consistent with regional Fed reports.
Source: @economics Read full article
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2. June construction spending was revised upward, making July the first monthly decline in 20 months (2 charts).
Source: MarketWatch Read full article
• Both residential and nonresidential sectors registered declines in July.
Source: @TheTerminal, Bloomberg Finance L.P.
• Public construction spending also softened.
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3. The Atlanta Fed’s GDPNow estimate was lowered by the ISM PMI report and the decline in construction spending.
Source: Federal Reserve Bank of Atlanta
Construction spending impacted the fixed investment component, while the ISM index lowered the contribution to goods spending.
Source: @TheTerminal, Bloomberg Finance L.P.
• On the other hand, Goldman’s GDP tracker shows 2.7% growth in the current quarter (annualized).
Source: Goldman Sachs; @MikeZaccardi
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4. US apartment construction continues to soften.
Source: @WSJ Read full article
5. The 2-year Treasury yield keeps drifting lower.
6. Household leverage has been trending down.
Source: @GinaMartinAdams
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Canada
1. Manufacturing activity almost stabilized in August, …
… but factory employment deteriorated.
More firms reported raising prices.
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2. Household net worth remains significantly above the pre-COVID trend.
Source: Scotiabank Economics
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The Eurozone
1. Economists’ estimates continue to show a significant divergence between Eurozone and US GDP growth for this year.
Source: @TheTerminal, Bloomberg Finance L.P.
2. Here is a look at euro-area import shares from the UK, US, and China.
Source: @DanielKral1
3. Italian consumer confidence declined last month.
Manufacturing sentiment also eased.
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4. Here is a look at Germany’s political polls over time.
Source: @bpolitics Read full article
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Europe
1. Swiss inflation has been slowing, …
… while economic growth accelerated last quarter.
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2. Denmark’s GDP growth has been largely driven by Novo Nordisk’s weight loss drug sales.
Source: @DanielKral1
3. European auto stocks are trading at historically low valuations with appealing dividend yields. (2 charts)
Source: PGM Global
Source: PGM Global
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Asia-Pacific
1. Taiwan’s manufacturing growth slowed last month.
Source: S&P Global PMI
• Taiwanese stocks dropped sharply today amid a semiconductor sector downturn.
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2. Singapore’s business activity hasn’t been this hot since 2022.
3. Next, we have some updates on Australia.
• The GDP growth continues to slow.
Source: The Guardian Read full article
• The CPI tracker showed further moderation in consumer inflation last month.
• Growth in household spending was softer than expected in July.
• Job vacancies continue to fall.
• Building approvals jumped in July.
• The current account deficit widened sharply in Q2.
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China
1. Services PMI indicators continue to show modest expansion (2 charts).
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2. The PBoC has been selling bonds to raise yields, aiming to avoid sending a signal of economic weakness, which lower yields would convey.
Source: @markets Read full article
So far, it’s not working.
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3. Equities remain under pressure, …
… amid negative earnings surprises.
Source: @Sebaboyd, @business, @TheTerminal, Bloomberg Finance L.P.
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4. The amount of local government bond issuance has lagged previous years.
Source: Alpine Macro
5. Hong Kong’s retail sales are running well below 2023 levels.
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Emerging Markets
1. Let’s begin with Chile.
• The central bank delivered another rate cut.
• The peso weakened, with USD/CLP hitting resistance at the 200-day moving average.
Source: @TheTerminal, Bloomberg Finance L.P.
• July’s economic activity topped expectations.
• Manufacturing output rebounded.
• Chile’s retail sales eased in July but held above 2023 levels.
• Business confidence is improving.
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2. Turkey’s inflation continues to moderate, …
… but controlling it remains difficult as the currency keeps depreciating. The USD/TRY exchange rate has now surpassed 34.
• The Q2 GDP growth was slower than expected.
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3. Hungary’s manufacturing activity has been contracting.
• Economists continue to downgrade the nations’ growth estimates for this year.
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4. Thai exports hit a record high (for July).
5. EM equities continue to widen their underperformance vs. DMs.
Source: Goldman Sachs; @MikeZaccardi
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Commodities
1. Steel and iron ore futures continue to sink amid concerns over weakened demand from China.
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2. Here is a look at global leaders in mineral and metals production.
Source: Matthews International Capital Management Read full article
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Energy
1. Crude oil futures tumbled this week.
The WTI oil futures price broke below support within a wide trading range.
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2. NYMEX gasoline futures broke below support two weeks ago.
• Gasoline futures signal further declines in prices at the pump.
Source: @TheTerminal, Bloomberg Finance L.P.
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Equities
1. Semiconductor shares tumbled on Tuesday, both in absolute terms and relative to the broader market, …
… dragged down by Nvidia. The stock fell further after hours following a DoJ subpoena.
Source: @technology Read full article
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2. The rebound in the Nasdaq 100 Index lost momentum.
The Nasdaq 100 reached its lowest level of the year relative to the S&P 500.
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3. Defensives outperformed on Tuesday.
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4. VIX is back above 20.
5. In election years, the market typically struggles between September and election day but tends to rebound afterward.
Source: Goldman Sachs; @WallStJesus
6. US equity funds registered eight consecutive weeks of inflows.
Source: @GunjanJS
7. Leveraged ETFs’ AUM surged in recent years.
Source: @WSJ Read full article
8. Globally, auto stocks have been under pressure.
Source: PGM Global
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Credit
1. CLO issuance remains robust.
Source: @markets Read full article
2. Here is a look at US banks’ holdings of securities compared to their business loans.
Source: Arcano Economics
3. Office vacancies keep rising.
Source: BCA Research
4. The muni market is going to be well supplied in September.
Source: @markets Read full article
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Food for Thought
1. Apple service usage among product buyers:
Source: @chartrdaily
2. How much do US households pay for streaming services?
Source: Bank of America Institute
3. Record highs in out-of-network ATM fees:
Source: @chartrdaily
4. Defined benefit vs. defined contribution pension plans in the US:
Source: @WSJ Read full article
5. Remarriage rates in the US:
Source: @WSJ Read full article
6. Revisions in UN population projections:
Source: Our World in Data
7. US voter enthusiasm:
Source: @axios Read full article
8. Global trends in childhood malnourishment and obesity by gender:
Source: The Economist Read full article
9. Land animals slaughtered for meat:
Source: Our World in Data
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