Succinct summations of events for week ending August 28, 2015
Positive:
1) After a wicked sell off, markets recover nearly all of their losses for the past week, now up slightly (tho still below mid-august levels).
2) 2Q real GDP growth was revised upwards to 3.7% (Q/Q SAAR) in the second release, a substantial improvement over 3.2% previously.
3) Odds of a Fed rate increase fell somewhat in light of China-induced market turmoil.
4) Continued recovery in housing: Pending home sales added 0.5% M/M in July;
New home sales added 5.4% M/M in July, increasing to 507,000.5) Core capital goods orders increased 2.2% mom, and core capital goods shipments increased 0.6% mom in July. .
6) Conference Board Consumer Confidence Index jumped up to 101.5 in August from 91.0 in July (NOTE: This was Pre-market turmoil)
Negative:
1) China’s economy slows, reflecting the both the law of big numbersa nd a limitation on centrally planned economies.
2) China’s stock bubble deflates, after being up as much as 67% YTD, its now negative on the year.
3) Crude Oil falls below $40m, then recovers — the most in two days since 2009 — to rebound above $40;
4) Personal spending in USA was reported at 0.3% mom in July, below expectations. Core PCE added 1.2% yoy in July.
5) University of Michigan Sentiment Index declined to 91.9 in the final report for August from 92.9 in the preliminary report, softer than expected.
6) Home prices disappoint, even though annual price appreciation accelerated to 4.5% Y/Y in June, it was still below consensus.
7) Although the data on core capital goods orders and shipments were notably stronger than expected, inventories were disappointing, leaving 3Q GDP tracking unchanged.
8) Claims in line: Initial jobless claims were reported at 271,000 for the week ending August 22, down slightly from 277,000 in the prior week
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