Succinct Summations week ending August 9, 2013.

Positives:

1. U.S. jobless claims four-week average falls to lowest level since November 2007.
2. 55% of S&P 500 companies have beaten Q2 Earnings estimates, (historical average of 53%).
3. All 13 manufacturing categories increased in June — this is has not happened since 1992.
4. China’s July exports grew by 5.1% crushing expectations of 2.0%. Imports surged 10.9% v expectations of 1% (many have doubts about their validity).
5. ISM non-manufacturing index increased to 56
6. Q2 S&P 500 Earnings Expectations are 1.3% higher than at start of earnings season.
7. PMI in Eurozone hits an 18 month high of 49.8.
8. The trade deficit narrow to $34.2B in June, narrowest it has been since 2009. Exports were up 2.2% m/o/m while imports were down 2.5%.
9. U.K. PMI came in at 60.2 — its highest reading since 2006!
10. German June manufacturing orders rose 3.8%

 

Negatives:

1. S&P 500, Dow and the Nasdaq all finished the week in the red for the first time in 8 weeks.
2. Companies that miss EPS are being punished especially hard this season, with underperformance averaging 3.9%, v a long term average of 2.5%.
3. U.S. initial jobless claims rose 5k last week to 333k v expectations of 335k.
4. U.S. consumer credit grew by $13.8B v expectations of $15B.
5. U.S. postal service reported a $740M loss in Q3.
6. Germany exports and imports came in weaker than expected for the month of June.
7. Sorry bears, not much world ending news this week.

Thanks, Mike!

Category: Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

13 Responses to “Succinct Summation of Week’s Events (August 9, 2013)”

  1. cuprous says:

    Are the record high margin levels a positive or negative?

    • Asked differently:

      Can you show me where record high margin levels were a sell signal in the past? We had 100s of examples of them in the 1990s. What is the win/loss ratio of trades based on this?

  2. Anonymous37 says:

    3. U.S. initial jobless claims rose 5k last week to 333k v expectations of 335k.

    If the initial jobless claims came out 2k lower than expectations, isn’t that a positive? Or is the negative the fact that the jobless claims increased?

  3. manav007 says:

    There are 418 companies in the S&P500 index that are not classified as a “financial”. The average earnings surprise for this group (368 have reported) is +1.19% so far according to Bloomberg. All good there. However, the average YoY earnings GROWTH is -1.99%. any thoughts? why should one be buying anything but financials in the index? where is the earnings growth in the non-financial sectors?

  4. Frwip says:

    Sorry bears, not much world ending news this week.

    Oh, you just wait for the end of the world to be back from its vacation in Tuscany…

  5. chartist says:

    I work for a Tier one Japanese auto parts supplier in the Midwest. We are ahead of plan for 2013 in terms of sales and earnings. We are hiring and we are expanding.

  6. chartist says:

    I am in Jeffrey Saut’s camp, a little dip but it’s a bull market….I continue to use Ford as a tell….It was pretty strong in the face of a tepid market….I expect I’ll get a chance to re-buy F around 15.75 in the weeks ahead….

  7. VennData says:

    Shelton Orders Shutdown of Space Fence

    http://www.spacenews.com/article/military-space/36655shelton-orders-shutdown-of-space-fence

    ​​I bet the Tea Party plan is to pool all the money they save in tax cuts and rent time on the Chinese Space fence when they get theirs ready….

    Oh what was I thinking?! Move it down to Texas to protect us from all those job creator-recipients… er… a… I mean, drug mules.

    Thanks GOP Voter.

  8. [...] Succinct Summation of Week’s Events (The Big Picture) [...]

  9. katzdog says:

    What appears to be missing from the discussion is what happens if there is no tapering. QE to infinity is necessary to keep the wheels greased, while keeping the bond market afloat and the stock market hanging in there. Therefore, there can be no tapering. Thus, the Fed may be gaming the cosmos at this point–and if they do, one of those space rocks or solar flares is likely to provide us with a whole lot of fireworks.

  10. Willy2 says:

    - “Trade Deficit narrows to $ 39.2 billion”
    This is supposed to be a positive ? Anyone who’s (somewhat) familiar with “Balance of payment” and the implications for the US knows that this should be put in the “negatives” part of the ledger.
    - When I look at my indicators then they all still are firmly in “Bear market” territory. Recently I could add one more check mark to the list of bear market indicators.
    - What is the source for those chinese trade figures ? The chinese government itself ?
    http://jugglingdynamite.com/2013/07/30/japan-heading-back-to-recession-despite-all-the-abenomics-hype/
    More “hedonics” but now from the chinese government ?

    • Willy2 says:

      I have to admit that two indicators turned bearish. One was for about 2-3 weeks undecided and seemed to have made a turn for the worst. And another indicator was still bullish but turned bearish at the beginning of this week.