Succinct summation of the week’s events:
1) Jobless claims declined to the lowest level since ’07 (320k, 15k less than expected); 4 week average = 332k
2) Eurozone exits recession after six quarters as its economy grew 0.3% in Q2. European stocks have quietly outperformed U.S. equities by ~10% over the last month.
3) Despite all the noise, US markets are down only ~1.9% for the month and +16% YTD.
4) Treasuries yields rose to their highest levels since August 2011, signaling a healthier economy as the fed begins to prepare for the taper
5) Multi family housing starts in July rise 63k (permits up by 37k)
6) CPI rose 2% y/o/y in line with expectations; PPI in July benign as headline figure flat and core rate up just .1%.
7) July retail sales increased 0.2%, ex-autos +0.5%. June retail revised up t0 0.6% from 0.4%.
8) Bullish sentiment drops to a 7-week low while bearish sentiment drops to a 7-week high (contrarian buy signal).
9) In light of concerns with Chinese growth, Hong Kong’s economy grows .8% q/o/q in Q2, above the estimate of 0.5%
10) NAHB home builder sentiment rises to 59 from 56, best since November ’05
11) Greece Q2 GDP showed its slowest rate of decline since 2011.
1) Yields are 75% higher than their bottom in May, the largest % increase over a similar timeframe since ’62.
2) Dow posted first back-to-back triple-digit drop since June; The S&P 500 was off ~2.3% for the week
3) Single family home starts fall 13k to 591k — lowest since November 2012; permits fall by 12k.
4) Consumer confidence falls to 80 v expectations of 85.2, the biggest miss since early April
5) Tough week for big retailers: Walmart, Macy’s and Kohl’s all reported weak quarterly numbers. US Retail Sales in July up just .1% ex gasoline mostly due to interest rate sensitive sales
6) IP flat m/o/m in July vs expected gain of .3% as manufacturing production falls .1% led by auto’s.
7) Both NY and Philly manufacturing indices in August moderate from July.
8) From GDP standpoint, Business Inventories continue to flat line in July
9) MBA said refi apps fell another 4.4%, down for the 13th week in the past 14 to a fresh two yr low. Refi’s are now down 59% over this 14 week stretch. Purchase apps drop 5.4% to a 6 month low.
10) After falling 1.7% in 2012, US Productivity rebounds just .9% (also annualized) in Q2.