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Registered Investment Adviser Caleb Lawrence 

Despite another North Korean rocket launch, terrorist attack in London and some fairly significant economic data misses the major averages enter the final hour with small gains. Since Monday the Standard and Poors 500 Index is up 22 points or .9% while the NASDAQ has gained 34 points or .5%.

Retail sales missed expectations in August falling .2%, July and June were revised materially lower sending the 4-month average to zero or no growth. Weakness was noted in online, clothing, electronics, and appliance sales. On a year ago basis sales are up 3.2% but the trend is definitely down. While some pundits attempted to blame the miss on Hurricane Harvey it didn’t come ashore until the 25th when the month was all but over.

The New York Fed regional index slipped .8 points in September on weakness in the average workweek, all other subcomponents improved. Prices paid advanced 4.8 points to 35.8.

In a sharp miss to expectations industrial production fell .9% in August on a very large decline in utilities output, mining and manufacturing also fell. This marks the largest monthly decline in 8 years for the series, capacity utilization also fell sharply dropping .8 points to 76.1%. Again, Hurricane Harvey was blamed but I think that excuse is a little thin based on the calendar, that said the hurricanes will start to have a meaningful short-term impact in the coming months. For all the pundits, out there that think destruction is an economic positive, all I can say is don’t forget to factor in the various declines when you trumpet the gains of whatever metric your promoting.

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