The Boock Report

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The dollar/Yields/China data

On this last day of 2019 there are only a few things to mention. One is that this will be my last writing until Monday January 6th. Cheers to 2020. The notable mover today is the continued weakness in the US dollar as the euro heavy dollar index is lower for the 7th straight day to a level last seen at the end of June. Whether its due to the Fed's expansion of …

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Mfr’g/Housing

The December Chicago manufacturing index remained below 50 but did rise slightly to 48.9 from 46.3. That was 1 pt more than expected. For the quarter just ending, business confidence of 46.2 was the weakest since Q2 2009. New orders slipped slightly  to 49.1 while backlogs rebounded off a 4 yr low but remain below 50. Inventories were below zero for a 5th …

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Labor costs/Data/Euro and European yields moving higher still

While it's not new news, this article highlights a key thing to watch in 2020 as it was a big influence on corporate earnings in 2019. //www.wsj.com/articles/rank-and-file-workers-get-bigger-raises-11577442600. The main reason why corporate profits fell in 2019 (as currently estimated) was that profit margins dropped, offsetting the rise in revenue growth. It is …

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Succinct Summation of the Week’s Events – 12/27

Positives 1)Japan's unemployment rate in November fell to 2.2% from 2.4% unexpectedly. The estimate was for no change. This was driven by a rise in the number employed and a drop in the size of the labor force. Also of note was the jobs to applicant ratio which held at 1.57, near the highest since the 1970's. 2)For the first 20 days of December, exports out of …

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A few things

In the midst of the now 11 day winning streak in the NASDAQ, the 10 yr Treasury yield just sits there like a lump of coal remaining within the 1.80-1.90% level over the past 3 weeks. I'll say this about this incredible stock market rally, if there was ever going to be a good test case of whether stocks are still a good discounting mechanism of what's to come in a …

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New home sales

New home sales in November totaled 719k, 13k less than expected and October was revised down by 23k to 710k. Months’ supply fell to 5.4 from 5.5, much higher than the inventory in existing homes while the median home price rose 7.2% y/o/y to $330,000, the highest since April. With price, this was influenced by a pick up in the number of homes sold above $400k and …

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Durable goods/South Korean exports/Rates

Core durable goods orders in November rose .1% m/o/m as expected but are down 1.1% y/o/y. Versus last year, orders for vehicles/parts, computers/electronics, machinery and metals all fell while those for electrical equipment were higher. The .3% drop in shipments vs the estimate of no change along with the one tenth downward revision to October could lead to a …

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Succinct Summation of the Week’s Events – 12/20

Positives 1)The December Markit US manufacturing and services PMI was little changed from November at 52.2 vs 52 last month. The manufacturing component fell a hair to 52.5 from 52.6 while services was up by .6 pts to 52.2. With services again leading the way, Markit said “Although the increase in new business remained historically muted, the rate of expansion …

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