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Registered Investment Adviser Caleb Lawrence

The major averages enter the final hour with modest gains on mixed data. Personal spending advanced .2% in July on a large gain in durable goods spending particularly motor vehicles and parts along with home furnishings and equipment. The Personal Consumption Expenditures Deflator or PCE gained .1% in July, the year ago rate held steady at a very low 1.4%. Personal Income advanced .4% in July marking a 7-month period of solid gains. Income on assets, wages and rental income gains led the increase. On a year ago basis disposable income advanced 2.7%, the savings rate came in at 3.5%, real or inflation adjusted disposable income increased just 1.3%.

Recent data on real estate has come in on the soft side. The Pending Home Sales Index fell .8% in July a 4th drop in the last 5 months. Declines were seen in all regions except the West, which advanced .6%. On a year ago basis pending home sales are down in all sectors except the Northeast which is up 2.4%.

AutoData reports that vehicle sales increased fractionally to 16.8 million units annualized in July as car sales gained and light truck sales slipped. Despite very aggressive incentives sales failed to break above 17-million for a 3rd consecutive month with vehicles staying on the dealer lot for an average of 76 days an 8-year high.

Semiconductor billings increased 2% in June to 32.6 billion on domestic demand strength. A 4th consecutive strong monthly showing, 2nd quarter sales marked a new record high.

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