With today’s GDP release, we can see that activity in the fourth quarter was somewhat less than first reported. Adding to the bad news, the housing contribution to GDP growth was -.3% in the fourth quarter. This is obviously disappointing given the trillions of dollars of QE, aimed directly at the housing market.
Along with today’s release of encouraging retail sales data across a number of European countries came the similarly positive earnings results for Luxottica. A look at our point-and-figure charts suggests that the trend for the company’s stock is all but certain.
Although stocks have erased losses from earlier in the year and are now making new all-time highs, the metal with a PhD in economics is acting a bit less sanguine. Indeed, copper failed to make a new high in February and has now broken it’s medium term uptrend line despite the strength in stocks.
Margin debt in NYSE accounts increased again in January to an all-time high. This series tends to top out before major market corrections occur. Margin debt is now at an all-time has a percentage of total market capitalization.
While the MSCI World consumer staples sector is not the source of scorching growth, there are some decent growth opportunities. Let’s start by calibrating the drug retail industry within the consumer staples sector.
Mining CapEx in Australia posted another down quarter in 4Q13 and was down about 7% vs peak CapEx spending that occurred in 4Q12 (Chart 1). Granted, CapEx is still at a high level, but we may be seeing some of the first signs that the trend in mining investment has reversed.
One of the ways we look at inflation around the world is by taking a simple average of 33 different countries year-over-year percentage change in CPI. By this measure, in January, year-over-year change in World CPI fell to it’s lowest level since November 2009.
For the week ending February 21st, foreign investors were net buyers of Japanese stock for the first time since the middle of January (Chart 1).
As we saw yesterday, Germany’s Q4 GDP release was neither surprising nor very exciting. A similar look at today’s release of output in the U.K. reveals a more constructive picture: With positive contributions from all sectors– and a sizeable rise in business investment– the trend on this country’s heat map is skewed decisively green.U.K.
The housing data has been all over the place so far in 2014. The good news today is new home sales jumped nearly 10% month-over-month to a five year high level of 468K for January.