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 Macro Brief: Personal Income & Outlays

5.27.2022

In April, personal income increased 0.4% or $89.3 billion. Personal consumption expenditures (PCE) increased 0.9% or $152.3 billion. Year-over-year, PCE jumped 4.9% indicating a slowing in rising inflation

  • Personal income rose by 0.4%, below consensus estimates of +0.6%
  • Consumer spending increased by 0.9%, slightly above consensus estimates of +0.7
  • Increases in compensation primarily drove the higher personal income. Wages and salaries of services-producing industries increased $51.1 billion while wages and salaries of goods-producing industries incerased $10.9 billion
  • Headline PCE rose just 0.2% month-over-month, well below March's 0.9% increase
  • Personal outlays increased $155.3 billion, personal saving was $815.3 billion, and the savings rate was 4.4% in April 

 Macro Brief: GDP

5.26.2022

According to the second estimate released by the Bureau of Economic Analysis, Real Gross Domestic Product (GDP) decreased at an annual rate of 1.5% in the first quarter of 2022

  • Advance estimate shows Q1 2022 GDP dipped 1.5% Q/Q, below consensus estimates of -1.3% and well below a 6.9% increase in Q4 2021
  • Real consumer spending rose 3.1%,  above estimates of 3.0%
  • The decrease in Real GDP was a result of decreases in private inventory investment, exports, federal government spending, and state and local government spending, while imports increased. Personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed investment also increased

 Global Thematic Playbook

5.25.2022

An overview of the Global Thematic ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • The KraneShares CSI China Internet ETF (KWEB) gathered another $388 million in net inflows over the past week even after the fund declined over 7% on the week. The ARK Innovation ETF (ARKK) saw $207 million in net outflows last week and declined just over 4%. Year-to-date, KWEB has seen $1.9 billion in net inflows and dropped 32% while ARKK has seen $1.4 billion in net inflows and dropped 58.55%
  • All thematic segments have fallen over 20% on average thus far in 2022. FinTech has been the worst performing segment losing 47.10% on average
  • Only 9 thematic ETFs have posted gains over the past month. The list includes 2 Solar ETFs (RAYS, +9.00% & TAN, +2.81%) and 4 ETFs focused on China (KSTR, +4.69%, KEJI, +3.16%, KGRN, +2.34%, & KFVG, +94 bps)
  • Each of the top 10 worst performing thematic ETFs on the month are Blockchain ETFs, 5 of which have declined over 40% (DAPPCRPTBKCHBITQDAM)

 

 Macro Brief: Durable Goods Orders

5.25.2022

New orders for durable goods rose $1.2 billion or 0.4% in April, the 6th monthly increase over the last 7 months despite ongoing inflationary pressures and supply-chain issues

  • New durable goods orders increased by 0.4% last month versus consensus estimates of 0.5%
  • Core capital goods were up just 0.3%, below consensus estimates of 0.55
  • Unfilled orders increased 0.5%, the 20th straight monthly increase
  • Inventories rose for the 15th consecutive month, +0.8% in April
  • The data indicates that business investment remains strong and factory output is holding up despite labor shortages, historically high inflation, and continued supply-chain constraints

 

 U.S. Factor Playbook

5.24.2022

An overview of the U.S. Factor ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • Momentum/ Growth ETFs continue to lag other U.S. Factor strategies. On average, Momentum/ Growth ETFs trail all other factor strategies across the 1-month, 3-month, year-to-date, and 1-year periods
  • The iShares Core High Dividend ETF (HDV) gathered $1.9 billion in net inflows over the past week while the iShares MSCI USA Value Factor ETF (VLUE) saw $1.05 billion in net outflows on the week
  • All U.S. Factor ETFs have seen declines over the past month. The worst performer on the month was the Alpha Intelligent - Large Cap Growth ETF (AILG) which dropped 14.01%. AILG is down over 36% thus far in 2022
  • S&P 500 Equal Weight (RSP), S&P 500 Quality (SPHQ), S&P 500 Value (SPVU), and S&P 500 Momentum (SPMO) are each currently trading below relative 50-Day and 200-Day Moving Averages. S&P 500 Dividend (SPYD) is currently trading above its 200-Day Moving Average and is just below its 50-Day Moving Average

 

 Macro Brief: New Home Sales

5.24.2022

After falling for three straight months, new home sales plunged 16.6% in April to a 2-year low and were significantly below consensus estimates. Rising materials costs, higher purchase prices, rate hikes from the Fed, and limited supply have continued to drive buyers out of the market

  • New Home Sales declined last month to an annual rate of 591K vs consensus estimates of 750K , 26.9% below April 2021 levels
  • Median home sales price rose $14K to $450,600
  • Average sales price jumped $46K to $570,300
  • The Midwest, the South, and the West all saw double digit month-over-month declines in sales
  • The 30-year fixed-rate mortgage now stands above 5% for the first time since February 2011
  • Homebuilder ETF Plays: ITB, XHB, HOMZ, NAIL

 Macroeconomic Review

5.23.2022

Major macroeconomic releases for the prior and upcoming weeks accompanied by historical macroeconomic data and chart books

  • Retail Sales: In April, Retail Sales increased 0.9% from March 2022 and jumped 8.2% from April 2021. Importantly, these numbers are not adjusted for inflation and therefore indicate sustained spending and the fastest acceleration in prices in the U.S. in roughly 40 years
  • Industrial Production & Capacity Utilization: Industrial production increased 1.1% in April, the 4th straight month of gains of 0.8% or greater, and manufacturing ouptu also increased by 0.8%
  • Business Inventories: Business inventories jumped 2.0% month-over-month in March while sales rose 1.8% month-over-month
  • Housing Market Index: The housing market index continued to decline last month amid slowing sales, high materials costs, rising interest rates, and lack of supply 
  • Housing Starts & Permits: Building permits declined 3.2% in April, housing starts were relatively flat, and housing completions dropped 5.1%
  • EIA Petroleum Status Report: For the week ended May 13, U.S. crude oil refinery inputs increased 239K barrels per day to 15.9 million barrels, U.S. crude oil and gasoline inventories fell while distillate inventories increased. The national average retail regular gasoline price rose to $4.491
  • Jobless Claims: Initial jobless claims rose 21K to 218K last week while continuing claims fell another 25K to the lowest levels since December 27, 1969
  • Philadelphia Fed MBOS: The index for current economic activity fell 15 points to its lowest levels in two years while the price indexes remain elevated
  • Existing Home Sales: Existing home sales declined for the third consecutive month in April, falling 2.4% another 2.4% month-over-month. Since April 2021, existing home sales are down nearly 6% and are at the lowest levels since the start of the pandemic

 U.S. Sector & Industry Playbook

5.23.2022

An overview of the U.S. Sector ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • Financials ETFs saw nearly $1.8 billion in net outflows over the past week with the Financial Select Sector SPDR Fund (XLF) posting net outflows of $1.3 billion. The iShares U.S. Infrastructure ETF (IFRA) and the Communication Services Select Sector SPDR Fund (XLC) gathered the most net inflows last week with $659 million and $449 million, respectively
  • Consumer Discretionary ETFs have fallen nearly 12% on average thus far in May. Energy ETFs have risen 3.36% on average and Utilities ETFs have added 1.01% on average in May
  • Only 4 U.S. Sector & Industry ETFs have posted gains over the past month (AMTR, XLE, MLPO, IYE), all of which are Energy ETFs. Meanwhile the SPDR S&P Internet ETF (XWEB) has dropped nearly 25% and the SPDR S&P Metals & Mining ETF (XME) has declined nearly 23% on the month
  • All U.S. Sectors are currently trading below relative 50-Day and 200-Day Moving Averages except for Energy (XLE), which is trading above its 50-Day and 200-Day Moving Averages, and Utilities (XLU), which is trading abvoe its 200-Day Moving Averages, but just below its 50-Day Moving Average

 

 Macro Brief: Existing Home Sales

5.19.2022

Existing home sales declined for the third consecutive month in April, falling 2.4% another 2.4% month-over-month. Since April 2021, existing home sales are down nearly 6% and are at the lowest levels since the start of the pandemic

  • Existing sales reported 5.61 million vs 5.65 million estimated, down 5.9% year-over-year
  • Median price for an existing home sold increased 14.8% year-over-year to $391,200
  • At the end of April, the inventory of unsold existing homes increased 10.8% to 1.03 million which would support 2.2 months at the monthly sales pace
  • Homes remained on the market for an average of 17 days, unchanged from March levels

 

 Macro Brief: Housing Starts

5.18.2022

Housing starts were relatively flat while building permits declined in April as mortgage rates continue to climb and supply chain challenges continue to impact new builds

  • Housing starts dropped 0.2% month-over-month in April to 1.724 million, but remains 14.6% above April 2021 levels
  • Building permits fell 3.2% from March levels to 1.819 million, 3.1% above March 2021 levels
  • As the Federal Reserve continues to raise interest rates, average 30-year fixed mortgage rates jumped to 5.3%, the highest since 2009
  • Single-family housing starts, which represents the largest share of homebuilding, dropped 7.3% on the month
  • Materials prices remain high amid historically high inflation which has affected new construction and buyer capacity

 

 Global Thematic Playbook

5.18.2022

An overview of the Global Thematic ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • The ARK Innovation ETF (ARKK) saw $469 million in net inflows and the KraneShares CSI China Internet ETF (KWEB) gathered $255 million in net inflows while the iShares Global Clean Energy ETF (ICLN) saw $114 million in net outflows over the past week
  • All thematic segments have declined over 10% on average over the past month, with the exception of Industrial Revolution ETFs which have sunk 8.77%. Month-to-date, FinTech ETFs have plunged 16.92% on average
  • Over the last month, only one thematic ETF has posted gains: the ProShares Smart Materials ETF (TINT, +13 bps). 9 of the 10 worst performing ETFs on the month are Blockchain ETFs. The First Trust SkyBridge Crypto Industry & Digital Economy ETF (CRPT), the VanEck Digital Transformation ETF (DAPP), the Global X Blockchain ETF (BKCH), and the VanEck Digital Assets Mining ETF (DAM) have all plunged over 40% over the past month
  • Only three thematic ETFs (REMX, LIT, QTUM) have posted gains over the past year. The worst two performers on the year are Cannabis ETFs (POTX, MJUS) and both have declined over 67%

 

 U.S. Factor Playbook

5.17.2022

An overview of the U.S. Factor ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • All U.S. Factor strategies are down year-to-date, with Momentum/ Growth ETFs declining over 20% on average and Quality ETFs falling over 14% on average
  • The SPDR Portfolio S&P 500 High Dividend ETF (SPYD) gathered $1.1 billion in net inflows over the past week while the iShares MSCI USA Value Factor ETF (VLUE) saw $747 million in net outflows on the week
  • Only one U.S. Factor ETF has posted gains over the past month: the Global Beta Smart Income ETF (GBDV) which has added just 35 bps. The Alpha Intelligent - Large Cap Growth ETF (AILG) has fallen the furthest over the month, dropping nearly 21%
  • S&P 500 Equal Weight (RSP), S&P 500 Quality (SPHQ), S&P 500 Value (SPVU), and S&P 500 Momentum (SPMO) are each currently trading below relative 50-Day and 200-Day Moving Averages. S&P 500 Dividend (SPYD) is currently trading above its 200-Day Moving Average and is in line with its 50-Day Moving Average

 Macro Brief: Retail Sales

5.17.2022

In April, Retail Sales increased 0.9% from March 2022 and jumped 8.2% from April 2021. Importantly, these numbers are not adjusted for inflation and therefore indicate sustained spending and the fastest acceleration in prices in the U.S. in roughly 40 years

  • Headline retail sales increased month/month by 0.9%, just above consensus estimates of 0.8%
  • Excluding autos & gas, sales also rose by 1.0%, above consensus estimates of 0.6%
  • Gasoline stations were up 36.9% year/year while food services and drinking places were up 19.8% year/year
  • April's retail sales figures were bolstered by a 4% gain from miscellaneous retail and a 2.1% increase in online sales

 

 U.S. Sector & Industry Playbook

5.16.2022

An overview of the U.S. Sector ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • Over the past week, Financials ETFs saw nearly $1.3 billion in net outflows as the Financial Select Sector SPDR Fund (XLF) seeing $856 million in net outflows. The Fidelity MSCI Utilities Index ETF (FUTY) and the SPDR S&P Biotech ETF (XBI) saw the largest net inflows on the week with $452 million and $450 million, respectively
  • Consumer Discretionary ETFs, Communication Services ETFs, and Multi-Sector ETFs have all dallen over 20% yuear-to-date. Meanwhile, Energy ETFs have surged over 30% thus far in 2022
  • The SPDR S&P Metals & Mining ETF (XME) dropped 22.85% over the past month, but is up over12% year-to-date. The SPDR S&P Internet ETF (XWEB) has fallen 22.65% in the past month and over 40% year-to-date
  • The S&P 500 (SPY), Communication Services (XLC), Consumer Discretionary (XLY), Financials (XLF), Health Care (XLV), Industrials (XLI), Materials (XLB), Real Estate (XLRE), and Technology (XLK) are all trading below relative 50-Day and 200-Day Moving Averages. Consumer Staples (XLP) and Energy (XLE) are trading above relative 50-Day and 200-Day Moving Averages

 

 Macro Brief: Import & Export Prices

5.13.2022

In April, Import prices were unchanged after rising nearly 3.0% in March while Export prices rose just 0.6% after increasing 4.1% in March

  • Import prices were flat last month, but remain up 12% year-over-year while export prices rose 0.6% and are up 18.0% year-over-year
  • U.S. Import prices and U.S. Export prices have not declined since December 2021 (-0.4%, -1.6%)
  • Import fuel prices decelerated, falling 2.4% in April after surging 39.2% from December to March amid the Russian invasion of Ukraine. Import fuel prices have risen 64.3% over the past 12-months
  • Non-fuel Import prices were higher by 0.4% last month, the fourth consecutive monthly increase
  • Inflationary pressures have surged in Q1 2022 impacting prices across the board

 

 Macro Brief: Producer Price Index (PPI)

5.12.2022

The Producer Price Index (PPI) increased 0.5% in April, in line with consensus estimates. Year-over-year, the index has climbed 11% further illustrating inflationary pressures

  • Headline and Core PPI rose by 0.5% and 0.4% month/month, respectively
  • After stripping out energy and food prices, core PPI rose 8.8% year/year
  • Final demand services were unchanged after increasing 1.2% in March
  • Final demand goods rose 1.3%, the fourth consecutive monthly increase
  • Prices for gas and groceries have been a significant factor in rising inflation with the two indexes rising 1.7% and 1.5%, respectively, in April

 

 Macro Brief: CPI

5.11.2022

The Consumer Price Index (CPI), a key inflationary measure, continued to rise in April after surging in March. Year-over-year, the CPI has shot up 8.3% nearing the highest levels in 40 years

  • Headline inflation increased 0.3% month/month in April, just above consensus estimates of 0.2%
  • Year-over-year, headline inflation was up 8.3%, also above consensus estimates of 8.1%
  • Core inflation climbed 0.6% month/month, above estimates of 0.4%
  • The food index increased for the 17th consecutive month in April while the index for energy subsided slightly as prices for gasoline fell 6.1%. Airline fares rocketed 18.6% on the month, the largest monthly increase on record
  • The Federal Reserve has now raised interest rates twice in order to battle historic inflation and the central bank has indicated several more interest rate hikes this year

 

 

 Global Thematic Playbook

5.11.2022

An overview of the Global Thematic ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • The ARK Innovation ETF (ARKK) gathered another $401 million in net inflows over the past week despite the fund falling over 18% on the week
  • After a brutal April, all thematic segments have fallen thus far in May. FinTech ETFs are down nearly 16% and Evolving Consumer ETFs have dropped over 10.50% in May
  • Each of the 10 worst performing thametic ETFs over the past month are Blockchain ETFs, highlighting recent weakness. The VanEck Digital Assets Mining ETF (DAM), the VanEck Digital Transformation ETF (DAPP), the First Trust SkyBridge Crypto Industry & Digital Economy ETF (CRPT), and the Global X Blockchain ETF (BKCH) have all plunged over 40% over the past month
  • Notably, nearly half (114) of the 233 global thematic ETFs listed in the U.S. are currently trading at 52-week lows

 

 U.S. Sector & Industry Playbook

5.9.2022

An overview of the U.S. Sector ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • The Financial Select Sector SPDR Fund (XLF) and the Energy Select Sector SPDR Fund (XLE) saw $1.6 billion and $1.1 billion in net outflows over the past week, respectively. Meanwhile, the Utilities Select Sector SPDR Fund (XLU) gathered $530 million in net inflows on the week
  • Energy ETFs continue to outpace other U.S. Sector ETFs, rising 4.12% on average in the last month. Communication Services ETFs have dropped nearly 14% on average and Health Care ETFs have dropped 11.57% on average in the period
  • The SPDR S&P Biotech ETF (XBI) has plunged nearly 25% over the past month while the Invesco Dynamic Energy Exploration & Production ETF (PXE) has risen 10.22%. XBI is down 37.36% and PXE is up 59.59% year-to-date
  • The S&P 500 (SPY), Communication Services (XLC), Consumer Discretionary (XLY), Financials (XLF), Health Care (XLV), Industrials (XLI), Materials (XLB), Real Estate (XLRE), and Technology (XLK) are all trading below relative 50-Day and 200-Day Moving Averages

 

 Macro Brief: Jobless Claims

5.5.2022

Initial jobless claims jumped to 200K last week well above consensus estimates of 178K while continuing claims fell another 19K to the lowest levels since January 17, 1970

  • Initial jobless claims rose 19K to 200K as the previous week's figures were updated to 181K
  • Continuing claims decreased 19K to 1.38 million while the 4-week moving average fell 36K to 1.42 million, the lowest levels since February 1970
  • Advance adjusted insured unemployment rate was unchanged at 1.0%
  • Separately, worker productivity fell 7.5% in Q1 2022, the fast decline since 1947, and labor costs soared 11.6%. Inflation has continued to surge as the Federal Reserve begins to combat rising costs by raising interest rates 

 

 Macro Brief: ADP Employment

5.4.2022

Following a sizeable increase in March, ADP private payrolls increased by 247K in April with the Service-Providing Sector adding over 200K jobs, largely in Leisure & Hospitality

  • The 247K increase in private payroll jobs was well below consensus estimates of +398K
  • Large companies and Midsized companies added 321K and 46K jobs, respectively, while Small companies saw declines of 120K jobs
  • The report further illustrates a historically tight labor market. Notably, the unemployment rate is approaching 3.5% and the gap of open jobs and available workers stood at 5.6 million at the end of March
  • The Professional & Business industry added 50K jobs and the Education & Health industry added 48K in April 
  • Next Up: Friday's Employment Situation


 Global Thematic Playbook

5.4.2022

An overview of the Global Thematic ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • For the second consecutive week, the Invesco Solar ETF (TAN) and the KraneShares CSI China Internet ETF (KWEB) saw the largest net outflows with $71 million and $52 million, respectively. The ARK Innovation ETF (ARKK) gathered the most net inflows over the past week with $114 million
  • April was a dismal month for global thematic ETFs performance wise. All thematic segments dropped over 12%, on average, with FinTech ETFs plunging over 22%, on average. With the exception of Sustainability ETFs, which have declined 18.41% year-to-date, all thematic segments are down over 20% thus far in 2022
  • The top performing thematic ETF over the past month was the ProShares Smart Materials ETF (TINT, -3.15%), further highlighting recent weakness in thematics. The worst performer was the AdvisorShares Poseidon Dynamic Cannabis ETF (PSDN) which plummeted another 37.09% on the month
  • Over the past year, only six thematic ETFs (REMX, BUG, CIBR, LIT, WCBR, EVX) have posted gains. REMX has handily outpaced all thematic ETFs on the year rising 26.68%. The four worst 4 performers over the last year are all Cannabis ETFs, each sinking over 65% (POTX, THCX, MSOS,CNBS)

 

 Macro Brief: JOLTS

5.3.2022

Job openings surged to a record high of 11.55 million in March while hires were little changed at 6.7 million. Notably, quits climbed to 4.5 million, also a record high in the month

  • Job openings increased 200K to 11.55 million, above consensus estimates of 11.27 million, and reached a series high which began in December 2000
  • February data revised higher from 11.266 million to 11.344 million
  • Hires increased slightly to 6.7 million while total separations edged up slightly to 6.3 million
  • Quits rose to 4.5 million reaching all time highs since the series began in December 2000 indicative of a historically tight labor market
  • Layoffs and discharges rate was unchanged at 1.4 million or 0.9%

 

 U.S. Factor Playbook

5.3.2022

An overview of the U.S. Factor ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

  • All U.S. Factor strategies have fallen over 5% on average in the past month and have declined over 5.75% on average year-to-date. Momentum/ Growth ETFs have underperformed, losing 9.31% on average in the last month and dropping over 17% on average thus far in 2022
  • Low Volatility ETFs continue to see solid net inflows with the Invesco S&P 500 Low Volatility ETF (SPLV) seeing $150 million in net inflows over the last week
  • The top performing U.S. Factor ETF in the last month was the Global Beta Smart Income ETF (GBDV) which was down 1.00%. The worst perfromer on the month was the Innovator IBD 50 ETF (FFTY) which plunged over 17%
  • S&P 500 Equal Weight (RSP), S&P 500 Quality (SPHQ), S&P 500 Low Volatility (SPLV), S&P 500 Value (SPVU), and S&P 500 Momentum (SPMO) are each currently trading below relative 50-Day and 200-Day Moving Averages. S&P 500 Dividend (SPYD) is currently trading below its 50-Day Moving Average, but above its 200-Day Moving Average

 

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