ETF Action Research

 Macro Brief: CPI


CPI makes first month/month increase since February

  • Core & headline inflation rose 0.6%, in line with consensus estimates (Core CPI slightly above)
  • Over half of the increase in the headline figure was due to a 5.1% increase in gasoline prices
  • Motor vehicle insurance index increased sharply in June pushing the core CPI figure higher
  • Inflationary pressures still low desite significant rise in M2 money supply

 Macro Brief: Producer Price Index (PPI)


June Producer Price Index posts monthly declines for headline and core inflation

  • Headline and Core PPI both came in below estimates
  • 80% of decrease in final demand index traced to 7.3% drop in margins for machinery and vehicle wholesaling
  • Indexes for apparel, jewelry, footwear & accessories retailing, fuels and lubricants retailing, dental care, and deposit services also fell
  • Major factor for price increases was from a 26.3% rise in gasoline prices
  • Little inflationary pressures so far despite near-zero interest rates and signifcant increase in M2 money supply

 Macro Brief: ISM Non-Manufacturing & Markit Services PMI


June ISM Non-manufacturing jumps to highest level in months after being in contraction during April and May

  • Index makes largest single-month percentage-point increase since debut in 1997
  • April appears to be the peak of weakness for non-manufacturing as the economy reopens
  • New orders, business activity, and employment all jumped (but employment remains in contraction)
  • 14 of 17 non-manufacturing industries reported overall growth in June
  • Markit PMI Services jumps but remains in slight contraction

 Macro Brief: JOLTS


Job openings were little changed in February, prior to COVID-19's impact

  • 5.397 million job openings vs est. 4.900 million
  • Number of hires hits 6.5 million in May (series high)
  • Total separations decreased by 5.8 million to 4.1 million (largest single decrease ever)
  • Quits rate rose to 1.6% while layoffs fell to 1.4%
  • JOLTS a lagging report which serves more as a confirmation of previous reports

 Macro Brief: ISM Manufacturing & Markit PMI


June ISM Manufacturing PMI returns to expansionary levels as economy begins to re-open in June

  • ISM PMI moves higher to 52.6 (est 49.0) from 43.1
  • Overall economy returned to expansion after one month of contraction
  • Markit PMI jumps record 10 points but still below the 50 expansionary level
  • Overall prices seeing slight upward pressure

 Macro Brief: ADP Employment


June ADP private payrolls increase by 2.369 milion, below consensus estimates of 3.500 million

  • Majority of gains came from small businesses (+937K)
  • Service-providing sector adds 1.912 million while goods-producing adds 457K
  • Large businesses (500 or more employees) add 873K payrolls
  • May payrolls revised to show companies added 3.065 million jobs instead of cutting 2.76 million
  • Next Up: Tomorrow's Employment Situation for June



 Macro Brief: Conference Board Consumer Confidence


Consumer confidence rises ahead of expectations in June (98.1 vs est 90.0)

  • Present conditions improve from 68.4 to 86.2
  • Expectations index moves higher from 97.6 to 106.0
  • Index levels improving but confidence still weak overall


 Macro Brief: S&P Corelogic Case-Shiller HPI


U.S. home prices accelerated higher in March 

  • S&P CoreLogic HPI 20-city index (SA) rose 3.9% Yr/Yr
  • Housing prices continue to be remarkably stable (and gently accelerating higher)
  • Increasing price growth result of low supply and low rates
  • Phoenix retains top city for the 11th consecutive month followed by Seattle and Minneapolis


 Macro Brief: Pending Home Sales Index


Pending Home Sales mark highest month/month gain ever

  • Index jumps to 99.6, a 44.3% rise from April data
  • All regions advanced month/month while the South region was up 1.9% year over year
  • Snapback recovery in housing activity showing the industry could help lead broader economic recovery
  • Supply still low and new home builds needed

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