Exports boost U.S. growth in third-quarter; consumer spending slows
U.S. Durable Goods Orders Declined in September Demand for long-lasting manufactured goods edged slightly lower in September, but the U.S. manufacturing sector appears to have found firmer ground as it closed out the third quarter.
Orders for durable goods—products designed to last longer than three years, such as trucks, computers and planes—fell 0.1% to $227.3 billion from a month earlier, the Commerce Department said Thursday. But that drop was from upwardly revised figures for August, and when excluding the volatile categories of defense and transportation products, new orders actually rose. (…)
Orders for nondefense capital goods excluding aircraft, a rough proxy for business investment, fell 1.2% in September, after posting three straight months of gains. It was the steepest drop since February. Despite the recent upticks, such spending remains 3.9% lower so far this year than in the same period a year ago. (…)
Haver Analytics’ table shows the uneven and weakish trends:
Shipments down, orders down (The Daily Shot):
But Markit’s flash October PMI released last Monday offers hope:
October data signalled that U.S. manufacturers started the fourth quarter in a strong fashion, with output and new order volumes rising at markedly faster rates than in September. A rebound in business conditions contributed to greater input buying among manufacturing firms and renewed pressures on capacity. At the same time, manufacturers sought to boost their stocks of inputs, with pre-production inventories rising for the first time since November 2015.
But there’s this, again:
U.S. Pending Home Sales Rebounded in September A gauge of coming home sales moved higher in September, a sign that last month’s rebound in homebuying activity might be sustained in the coming months.
The National Association of Realtors said Thursday that its pending home sales index, which tracks contract signings for previously owned homes, rose 1.5% from August to a seasonally adjusted 110.0. (…)
But pending sales, which close 1-2 months after signing, are flat over the last 3 months and point to lower existing home sales in October. (Charts from Haver Analytics)
After Hitting a 51-Year Low, the Homeownership Rate’s on the Rise The homeownership rate edges back up from a five-decade low amid tentative signs that renter families are starting to gain the confidence to buy homes.
It hit 63.5% in the third quarter, the Census Bureau said Thursday. That is a significant jump from the prior quarter, when it hit 62.9%, the lowest point in 51 years.
There were other reasons for optimism in Thursday’s release. About 1.1 million households formed in the third quarter, a significant jump from about 944,000 in the prior quarter.
More crucially, about half of the new households formed were owners, rather than renters. About 560,000 new owner households were formed this quarter, up from a roughly 22,000 decline in the second quarter. (…)
The homeownership rate is still lower than it was a year ago, when it sat at 63.7% compared with 63.5% today. Seasonally adjusted, the change in the homeownership rate to 63.4% from 63.1% in the prior quarter isn’t considered statistically significant.
The share of first-time buyers rose to 34% in September, the highest since July 2012, according to the National Association of Realtors. A recently released Zillow survey conducted this spring found that half of home buyers who bought in the prior year were under 36 years old. (…)
EARNINGS WATCH
- 269 companies (63.8% of the S&P 500’s market cap) have reported. Earnings are beating by 6.2% while revenues are surprising by 0.7%.
- Expectations are for revenue, earnings, and EPS of 2.7%, 0.9%, and 3.1%, respectively. EPS is on pace for +5.4%, assuming the current beat rate for the remainder of the season. This would be +9.1% excluding Energy.
These Are the Charts That Scare Wall Street
Worth your time.
Inflation Fear Fuels Bond Rout
(…) In the year to September, consumer inflation was 1.5% in the U.S. and 0.4% in the eurozone, the fastest annual price increases since 2014. Last month, Chinese factory prices rose for the first time in 4½ years.
The price rises are being driven by factors including U.S. wage increases and an upswing in the cost of commodities, from oil to coal. The Bloomberg commodity index fell more than 58% from its April 2011 peak to January this year but has since rebounded by 9%. (…)
