26. April 2013 06:57
The key release for today is the read on Q1 GDP out of the United States. Growth accelerated at an annualized rate of 2.5%, driven by strong consumer spending. Expansion didn’t hit the 3% expectation, but is a significant rebound from Q4’s anaemic 0.4% growth.
Despite the improvement the results appeared to dampen North American equities at the open.
Bond yields are down 2 – 3 bps.
And U.S. consumer sentiment dropped in April. The University of Michigan index fell about two points to 76.4. That’s the lowest level in three months, but not as bad as expected. Consumer optimism has waned a little as well; the expectations index dropped three points.
25. April 2013 06:57
North American markets got off to another upbeat start today. Investors appear to have re-grouped after yesterday’s initial enthusiasm evaporated. The TSX benefited from a rebound in commodities.
Bond yields are up 1 bps.
The only North American economic report of note today is the weekly read on first time jobless claims in the U.S. The latest number fell by 16,000 – dropping to a five year low and well beyond expectations. The four-week rolling average fell by 4,500.
Overseas offers a mixed bag of data:
Spanish unemployment rose to its highest level in nearly 40 years.
Britain’s economy dodged a return to recession and grew faster than expected in Q1.
The European Central Bank is widely expected to lower its benchmark interest rate by a quarter of a percent at its next setting.
24. April 2013 05:10
North American equities maintained their buoyant attitude at the open today, apparently bolstered by generally positive corporate results.
The only economic report of note today is the read on U.S. durable goods sales so markets will likely continue their focus on earnings as they look for direction.
Bond yields are up 2 – 4 bps.
The durable goods report shows March sales slumped 5.7% and February sales were revised slightly downward. The March decline was led by orders for commercial aircraft. Even with the volatile transportation component removed March sales were unexpectedly down by 1.4%.
Orders for non-defence capital goods excluding aircraft – a proxy for future business investment – rose just 0.2 percent, failing to make up for a 4.8 percent slump in February.
23. April 2013 05:10
Markets opened higher this morning carrying on the trend from yesterday’s close. Investors appear upbeat about corporate earnings despite signs of weakness coming out of China and Germany. Business activity in Germany actually shrank for the first time in five months. In China, growth in factory activity slowed to a crawl.
Bond yields are down 1 bps.
The sole economic release for Canada this week is February retail sales. They more than doubled expectations rising 0.8% over January. The increase was driven by sales at gas stations and general merchandise stores. Seven of 11 sub-sectors reported increases but sales volumes were flat.
Housing dominates in the U.S. today with the government’s house price index clocking-in with a 7.1% increase for February. The m/m figure is up 0.7% over January. Tightening supply, low borrowing costs and improving employment get the credit.
March new home sales in the U.S. rose 1.5% over February, just a shade better than expectations. Year-over-year, new, single family home sales are up 17.6%.