The Market Bull – May 30, 2019
The major averages closed with small gains on mixed data that shows the beginnings of the trade war’s impact as exports and imports both fell notably.
The Trade Deficit increased to 72.1 billion in April. Exports slipped to a 15-month low of 134.6 billion. Imports dropped to a 17-month low 206.7 billion.
Wholesale Inventories advanced .7% in April. Retail Inventories increased .5% over the same period. The first material gain for both since December. Improving sales helped to reduce the inventory to sales ratio.
1st Quarter revised GDP or Gross Domestic Product slipped to 3.1% as expected. Consumer spending decreased as did residential investment. Real disposable income growth slowed to 2.2% from a downwardly revised 3.2%. The saving rate rose to 6.7% from 6.5% in the fourth quarter. Profits fell 2.8% during the quarter after dropping 0.4% previously. Fixed residential investment has been positive in just 2 quarters over the last 2 years and has slipped for 4 consecutive quarters. Residential fixed investment has historically led the economy into and out of recessions.
Pending Home Sales took a dive in April falling 1.5% to 104.3. All regions fell except the Midwest. On a year ago basis all regions reported lower pending sales, something that is becoming increasingly common for the series.
Standard and Poors 500 Index closed at: 2,788.86 up 5.84
NASDAQ finished the day: 7,567.72 up 20.41
Gold ended trading at: $1,287.90 up $6.90