Succinct Summation of the Week's Events

Succinct Summation of the Week's Events:

Positives,

1)The US S&P Global composite PMI for May was better than expected mostly driven by a jump in services to 54.8 from 51.3. Manufacturing helped too as it rose to 50.9 from 50. Price pressures though rebounded. While confidence grew overall for both sectors, “companies remain cautious with respect to the economic outlook amid uncertainty over the future path of inflation and interest rates, and continue to cite worries over geopolitical instabilities and the presidential election.”

2)Initial jobless claims fell to 215k from 223k last week and that was 5k below expectations. The 4 week average, and thus smoothing out that supposed NY reporting issue a few weeks ago, rose to 220k from 218k and that is the highest since September 2023.

3)Core durable goods orders in April were as expected when we include the downward revision to March. So, the .3% m/o/m gain follows a one tenth decline in March. The same is the case for shipments, which plugs into GDP as the 3 tenths beat in April was offset by a 3 tenths downward revision to March. In dollars though, core durable goods orders haven't grown much over the past 2 years. 

4)Mortgage apps were mixed as refi's rose 7.4% w/o/w as rates fell again to about 7% and assume many of these are cash outs. 

5)The April Architecture Billings Index saw a rise to 48.3 from 43.6 though the components were mixed. The gain was led by commercial/industrial and the AIA chief economist said, "These findings indicate that while there is still caution among clients, there are also positive signs with increasing inquiries into new projects. Continued high interest rates make it difficult for some projects to move forward, but there is ongoing interest in pursuing these projects once conditions improve. In the meantime, design activity is expected to remain sluggish."

6)Target plans to lower prices for up to 5,000 products, it seems that it is focused on food, drink and other non-discretionary household items.

7)From Ross Stores: "though we had hoped to do better, first quarter sales were still in line with our guidance despite macroeconomic headwinds that continued to pressure our customers' discretionary spending."