Economic Prints Bring Some Heat: Retail Sales, Imports and More

Friday, November 15, 2024

It’s a big morning for economic data, concluding a week that gave us a new Inflation Rate (+2.6%) with CPI for October mid-week, followed by PPI yesterday. Similarly to those figures, the economy again looks to be heating up.

Pre-market futures are down at this hour, with the Dow -140 points, the S&P 500 -30 and the Nasdaq -180 points. The relief rally following election results last week looks to have given way to caution. Bond yields are up roughly 15 basis points (bps) on the week, suggesting there is now some resistance to a raging stock market.
 

Retail Sales for October Warm After Hotter September

Advanced headline Retail Sales for last month reached +0.4%, 10 bps ahead of expectations. This follows a previous-month print that is revised twice as high as the initial read: +0.8%. Remove volatile auto sales from the equation and we boil this down to +0.1%, but this too is off a flaming hot upward revision of +1.0% in September. At +0.1%, we’re now at our lightest point since May of this year.

Continuing to slice and dice these figures further, ex-autos and gasoline prices brings our print also to +0.1%, which follows an upward revision the prior month of 50 bps to +1.2%. To find a lower monthly number on this metric, you’d have to go back to April’s -0.1%. 

The Control number — which gets fed up the food chain of other economic reports, like PCE — was negative for this preliminary read: -0.1%, down from +0.3% expected and off a +50 bps revision to +1.2% the previous month. Again, this morning’s print is the weakest since April.

These big swings in data, along with a demonstration of how far-flung revisions can be on these measures, are perhaps best gathered in aggregate. We’ve resided with a “2-handle” year over year for 7-straight months. Month over month has resided mostly between 0-1.0% over that time period. In other words, despite a rapid cooling for October numbers, we’re pretty steady over the longer term.
 

Import/Export Prices Heat Up for October

A headline on October Import Prices jumps to +0.3% today, up 40 bps from consensus and +70 bps from the unrevised -0.4% the previous week. This is the highest monthly read since +0.9% back in April. Ex-fuel, this drops somewhat to +0.2%, matching the upward revision for September. Year over year, Imports are up +0.8%.

Exports, likewise, came in at +0.8%, way up from a negative print expected. This again is the highest since August, suggesting the global economy is anything but depressed currently — or, as of last month. Also, don’t forget about possible future revisions; we’ve likely got a few wrinkles to iron out.
 

Empire State Manufacturing Surges Back

The November headline on Empire State Manufacturing is +31.2% this morning — surging way ahead of the 0.0% expected, and even farther from the unrevised -11.9% for October. This is by far the highest manufacturing productivity number in the state of New York since December of 2021. Another economic log on the fire.
 

BABA Flat After Q2 Earnings Report

Alibaba (BABA Quick QuoteBABA - Free Report) , a Zacks Rank #1 (Strong Buy) going into this morning’s earnings report, was mixed for Q2: revenues came out slightly ahead of estimates, but earnings dipped nearly -5% from expectations. Shares are flat ahead of the open, +21% year to date, but well off early-October highs.

Check out the updated Zacks Earnings Calendar here.

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