Private nonfarm payrolls in the US are projected to increase by 200,000 (seasonally adjusted) in tomorrow’s April update from the Labor Department, based on The Capital Spectator’s median point forecast for several econometric estimates. The prediction reflects a substantially stronger increase vs. the 129,000 gain in March.
Continue reading →

Maintaining an optimistic outlook on the US economy has been a bit tougher lately. But one indicator has continued to shine while others have stumbled: initial jobless claims. The upbeat trend continues with today’s release. New filings for unemployment benefits inched higher last week, but remain close to a 15-year low. Although some data sets are looking wobbly these days, new claims are a conspicuous exception and still point to ongoing growth for the labor market.
Continue reading →

Has the red-hot momentum in sector ETFs run its course for this cycle?  Or is the latest speed bump one more temporary detour before the rally resumes? All but one of the major US equity sector ETFs are still sitting on gains for the trailing one-year period (252 trading days). Yet several ETFs have recently closed below their 50-day moving average for the first time since February. It may turn out to be noise, but the current weakness comes in the wake of mixed economic news, which suggests that concern about the US macro trend is a factor in the latest round of selling.
Continue reading →

● ADP: Second Consecutive Sub-200k Job Month In April for US | USN&WR
● US Job Creation Index Reaches New High of +31 | Gallup
● Biggest US Productivity Drop in Decades Sends Ugly Omen | Bloomberg
● Eurozone retail PMI posts highest reading for 10 months in April | Markit
● Solid growth of global economic output and new orders in April | Markit
● German Factory Orders Recover In March | RTT
● France March Industrial Production Falls Unexpectedly | RTT

Private-sector payrolls increased by a sluggish 169,000 in April, according to this morning’s release of the ADP Employment Report. The rise is the weakest gain in 15 months and well below the 200,000-plus increase that was expected via Econoday.com’s consensus forecast. The weak raises new questions about the health of the US economy and what to expect in Friday’s official jobs report from the Labor Department.
Continue reading →

The Washington Post wonders if the US has fallen into a new recession. The motivation for asking is the stall-speed growth in first-quarter GDP, which increased by a slim 0.2%. The fractional gain is quoted in quarter-over-quarter terms, which is the standard reference. By that measure, there’s virtually no growth. But are quarterly comparisons the best way to measure GDP in search of macro danger? It’s a timely question because the annual change in GDP through this year’s first quarter reflects a substantially stronger trend. In fact, GDP’s 3.0% year-over-year advance in Q1 accelerated, rising at the strongest pace in more than a year.
Continue reading →

● Pickup in Service Industries Points to U.S. Growth Rebound: ISM | Bloomberg
● US service sector jobs growth accelerates to 10-month high in April: PMI | Markit
● US Trade Deficit at 6-Year-High | US&WR
● Eurozone March retail sales weaker than expected | Reuters
● Eurozone growth continues as output rises across big-four nations: PMI | Markit
● Chinese business activity growth driven by service sector in April: PMI | Markit
● EU Boosts Eurozone Growth & Inflation Outlook On Positive Tailwinds | RTT

Private nonfarm payrolls in the US are projected to increase by 195,000 (seasonally adjusted) in tomorrow’s April update of the ADP Employment Report, based on The Capital Spectator’s median point forecast for several econometric estimates. The median projection represents a slightly higher increase vs. February’s rise.
Continue reading →

Chicago Fed President Charles Evans recommends waiting until 2016 to start raising interest rates. The tipping point, he advised in a speech yesterday, should be compelling evidence that wages are rising in a robust degree. For the moment, that evidence is lacking, he noted. Yet it’s not obvious that the Treasury market agrees with Evans. Yields on government bonds are still trending higher, despite a mixed batch of economic reports in recent weeks.
Continue reading →

● US factory orders rebound solidly, but trend still soft | Reuters
● Global Manufacturing PMI falls to 21-month low | Markit
● Eurozone producer prices pick up | MarketWatch
● Reserve Bank of Australia cuts official cash rate to record low 2% | SMH
● Inflation Expectations Tick Up | WSJ
● EU Raises Growth Outlook as ECB Counters Greek Threat | Bloomberg