1)Core retail sales in September rose 1.4% m/o/m, well better than the estimate of up .3% and only partially offset by a two tenths downward revision to August to -.3%.
2)Continuing claims, delayed by a week, fell 1.17mm to about 10mm with the hopes that many found jobs. Pandemic Unemployment Assistance also fell to 373k from 464k.
3)The Philly manufacturing October index jumped to 32.3 from 15 and that was well better than the estimate of little changed. Inventories remained below zero and that again helped in the rise in new orders and backlogs. Employment fell but the workweek rose. As for the 6 month outlook, it was up to 62.7 from 56.6 and capital spending plans here was higher.
4)The NFIB small business optimism index for September rose 3.8 pts m/o/m to 104. That is the best since February. Along with this though was their Uncertainty Index which rose to match the highest level since March 2017. The NFIB chief economist said “As parts of the country continue to open, small businesses are seeing some improvements in foot traffic and sales. However, some small businesses are still struggling financially to operate at full capacity while navigating state and local regulations and are uncertain about what will happen in the future.”
5)The initial October UoM consumer confidence index rose a touch to 81.2 from 80.4 and that was just above the estimate of 80.5. The components though were mixed as Current Conditions fell by 2.9 pts while Expectations was higher by 3.2 pts. One year inflation expectations rose one tenth to 2.7% from 2.6%. The 5 yr average is 2.6%. UoM pointed to this as the reason why Current Conditions fell: “Slowing employment growth, the resurgence in Covid infections, and the absence of additional federal relief payments, prompted consumers to become more concerned about the current economic conditions. Those concerns were largely offset by continued small gains in economic prospects for the year ahead.” The internals were very mixed.
6)After weakness seen in August, EU car registrations rose 3.1% y/o/y. Daimler last night said they have “seen a faster than expected market recovery and a particularly strong September performance.”
7)The Eurozone August industrial production gain in August was .7% m/o/m, slightly better than expected when the July upward revision is taken into account.
8)The credit continued to flow in China in September with aggregate financing totaling 3.48T yuan, about 500b more than expected. Of that, bank loans made up 1.9T vs the forecast of 1.7T. For perspective, in the 1st 9 months of 2020, credit growth is up a whopping 44% y/o/y. Money supply growth, as measured by M2, the widest kind, was higher by 10.9% y/o/y.
9)China said its September exports rose 9.9% y/o/y as expected but imports were much better than forecasts with its 13.2% jump vs the forecast of up just .4%. Imports were helped by Huawei stock piling and soybeans and other commodities like iron ore.
10)Also out of China was the strong September car sales data where vehicle sales rose 7.4% y/o/y, mostly led by a rise in SUV sales.
11)Australia’s September jobs report saw a less than expected drop in employment after a sharp rise in August that was revised higher. The unemployment rate was little changed at 6.9% vs 6.8%.
12)Australian consumer confidence in October jumped to 105 from 93.8. I don’t have an estimate but that level is the most since July 2018. Westpac, which released the data, also said “The budget and the outlook for interest rates have given a clear boost to the confidence of homeowners.”
13)Japanese core machinery orders in August (thus dated) did surprise to the upside with a .2% m/o/m gain vs the estimate of down by 1%. Versus last year orders were still down 15.2% but that is the smallest drop since March.
1)Initial jobless claims rose to 898k from 845k (revised up by 5k) and that is well above the forecast of 825k. That is also the most since August.
2)The October NY manufacturing index fell to 10.5 from 17. The estimate was 14. The internals were better as the 4 yr low in inventories led to gains in new orders, backlogs, employment and the workweek. The 6 month outlook fell to 32.8 from 40.3 and that is a 5 month low. After rising sharply in September, capital spending plans gave back some of those gains. The outlook for inventories rose 2 pts to 2.6 but that is the most since March.
3)The September CPI rose .2% both headline and core m/o/m. The y/o/y headline increase was 1.4% vs 1.3% in August and the core rate was higher by 1.7% y/o/y for the 2nd straight month. The slowing pace of services inflation is being offset by a rise in goods prices, particularly used cars.
4)September PPI rose .4% m/o/m both headline and core, double the estimate for each. Versus last year, headline PPI was up .4% vs -.2% in August while the core rate was higher by 1.2%, twice the gain seen in August. Contributing to the rise was an increase in both goods and service prices with both higher by .4% m/o/m. Food prices rebounded by 1.2% m/o/m after a few months of giveback. Energy prices fell by .3% m/o/m.
5)Import prices in September continued to creep higher. Ex petro they rose .7% m/o/m, two tenths more than expected after an .8% increase in August. Prices ex petro are now up 1.8% y/o/y, near the highest since 2012 and by 1.4% ex food/fuels.
6)Mortgage applications to buy a home fell for the 4th week in the past 5 as maybe its digesting the recent sharp gains. They were down by 1.6% w/o/w. Even so, they are still up 24% y/o/y reflecting the rest taking place at still a high level. The average loan size moderated from the record high seen last week. Refi’s were unchanged but still up 44% y/o/y although that is a slowing pace.
7)Industrial production in September was weak and well below expectations. The headline print fell .6% m/o/m vs the estimate of up .5% while the manufacturing component fell by .3% instead of rising by 6 tenths as expected (only partially offset by a 2 tenths upward revision to August). Also, capacity utilization fell to 71.5% from 72%.
8)Singapore said its September no oil exports fell by 11.3% m/o/m, worse than the estimate of down 4.4% but still up 5.9% y/o/y. It does come after a 10.5% m/o/m increase in August. Pharma has been the swing factor with it strong in August and giving back some gains in September. Exports of electronic products remained strong. From last year, exports to China were little changed, up 3.7% to the US and higher by 61% to the EU (driven by machinery and PC’s).
9)The German October ZEW Expectations index fell to 56.1 from 77.4 and that was well below the estimate of 72. Current Conditions were down by 6.7 pts to -59.5 but that was about as expected. ZEW said that while the index is “very clearly in positive territory…the great euphoria witnessed in August and September seems to have evaporated. The recent sharp rise in the number of Covid cases has increased uncertainty about future economic development, as has the prospect of the UK leaving the EU without a trade deal. The current situation in the run-up to the presidential election in the US further fuels uncertainty.”
10)The UK jobs data for the 3 months ended August was weaker than expected. Employment fell by 153k vs the estimate of -30k and the unemployment rate jumped by 4 tenths to 4.5% vs the estimate of 4.3%. The number of people laid off totaled 114k during these 3 months and that is the most since 1995. Also of note for September was the rise in jobless claims again by 28k.