Manufacturing
US equities have somewhat stabilized since the beginning of October. After falling by 6.6% in the prior two months, the S&P 500 ended the day on Wednesday 0.6% above where it was at the end of September. Indeed, recent hard data have been on the firm…
As expected, the New York Fed’s Empire State Survey sent a pessimistic signal about manufacturing conditions in October. The general business conditions index weakened from 1.9 to -4.6, albeit better than expectations of a more pronounced decline to -6.0.…
On the surface, the slower pace of contraction in Chinese exports in September is a positive signal for global trade. The 6.2% y/y drop in the dollar value of Chinese exports was not as bad as the 8% y/y decline anticipated or the 8.8% y/y decline in August. …
US monetary policy is restrictive, as evidenced by a falling jobs-workers gap. The reason that unemployment has not risen is because labor demand still exceeds supply. That will change in the second half of 2024 when the US economy succumbs to recession. Investors should increasingly favor bonds over stocks.
Domestic auto sales in China will likely have anemic growth over the next three years. Yet, Chinese automakers are set to gain a larger share of the global market. Go long Chinese automakers / short global ones.
The US PPI report came in hotter-than-anticipated in September. Although the headline index decelerated from 0.7% m/m to 0.5% m/m, it remains above expectations of a more pronounced moderation to 0.3% m/m. In particular, a 3.3% m/m increase in energy prices…
Taiwanese exports unexpectedly grew for the first time in just over a year in September – sending a positive signal about the global manufacturing cycle. The 3.4% y/y increase surprised anticipations of a moderation in the rate of decline from -7.3% y/y to…
According to BCA Research’s European Investment Strategy service, European automobile and components stocks will suffer over the coming years. The European automobile and components equity sector is cheap, trading at a modest 5.4 times forward earnings or…
As we highlighted in a recent Insight, the stronger-than-anticipated improvement in German factory orders should be viewed with some degree of caution. Germany is the European economy most exposed to the global manufacturing sector. Several leading indicators…
August brought some respite for German factories struggling with poor demand this year. After falling by 11.3% m/m in the prior month, German factory orders rebounded by 3.9% m/m in August – beating expectations of a 1.5% m/m increase. In particular, a…