Economic data

With some markets and many economic data points back to levels last seen in Sept ’08, the Baltic Dry Index is just shy of joining the club. It’s up today for a 13th straight day by another 2.7% and at 4220, is just 71 points from the highest since Sept 24th, 2008. It is now up 535% off the Dec ’08 low but still remains 64% off its record high in May ’08.

The Nov NY Fed survey, the 1st Nov manufacturing figure out, was 23.5, 6.5 pts below forecasts but comes after an almost doubling in Oct to 34.6. It still is the 2nd highest reading since Nov ’07 but is clearly volatile month to month. New Orders fell by almost half but puts it back in line with the Aug/Sept levels. Backlogs fell 5 pts to -2.6 and Employment fell 9 pts to 1.3 but remains positive for a 2nd month for the first time since May/June ’08. Inventories rose 1 pt but remain firmly negative at 17.1 and thus no signs yet of inventory stocking. Prices Paid fell by almost half but Prices Received rose to a one year high (although still slightly negative). The overall 6 month outlook rose almost 2 pts to 57, the highest since Oct ’04. Bottom line, manufacturing is recovering but it clearly will be a lumpy process and the weak US$ is likely helping the 6 month outlook, notwithstanding the longer term negative implications of it.

Oct Retail Sales rose 1.4%, .5% more than expected but ex auto’s they were up just .2%, .2% below forecasts. The Sept headline figure was revised lower by .8%, so taken together, the Sept/Oct data is a touch light. It’s worth looking at together as the auto industry see’s post clunker activity. Motor vehicles/parts sales rose 10.2% in Aug, fell 14.3% in Sept and rose 7.4% in Oct. Ex auto’s, Sept was revised up by .1%. Sales ex auto’s and gasoline rose 3%, right in line with expectations. Sales rose in the following categories: food/beverages, restaurants, health/personal care, clothing, department stores and online retailers. They fell in furniture, electronics, building materials and sporting goods. Bottom line, last week’s earnings from WMT, M, KSS, JWN, JCP, and ANF gave us plenty of good retail sales info, thus taking some surprise out of today’s data.

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