Rover's Weekly Market Brief —8/31/2018

Indices

DJIA: 25,964.80 (+0.68%)

NASDAQ: 8,109.54 (+2.06%)

S&P 500: 2,900.58 (+0.90%)

Commodities

Gold: 1,205.30 (-0.27%)

Copper: 269.05 (-0.37%)

Crude Oil: 69.90 (+1.72%)

Economy

The international trade deficit in goods increased by $4.3 billion to $72.2 billion (+6.3%) in July due to a -$2.5 billion drop in exports and a +$1.8 billion increase in imports. Exports increased for automobiles (+1.3%) after a -5.2% drop the previous month, and exports of industrial supplies, which include petroleum, remained unchanged after a +4.4% increase the previous month. Exports dropped for other goods (-8.4%), foods (-6.7%), consumer goods (-2.5%), and capital goods (-1.7%). For imports, only consumer goods fell (-1.5%), and all other categories increased with the largest increase for other goods (+11.1%). On a yearly basis, the largest increases were for petroleum (exports +23.4%, imports +21.1%), other goods imports (+16.9%), and food exports (+12.5%), with other goods exports (-0.3%) the only category declining on a yearly basis.

GDP for 2018 Q2 was revised upwards from July’s advance estimate by +0.1% to 4.2% on the basis of increases in nonresidential fixed investment, private inventory investment and government spending, and decreases in imports, with offsets from downward revisions to consumer spending, residential fixed investments and exports. The gross domestic purchases price index remained unrevised at 2.3%, but the narrower PCE price index measure of consumer inflation increased by +0.1% to 1.9%. The first estimate of real gross domestic income was 1.8%, down from +3.9% for Q1, and the average of GDP and GDI, a supplemental measure of economic activity, was 3.0% vs. 3.1% for Q1. Corporate profits from current production increased $72.4 billion in Q2 vs $26.7 billion in Q1, with profits of domestic financial corporations up $16.8 billion (vs $9.3 billion Q1), and profits of domestic nonfinancial corporations up $63.6 billion (vs 32.3 billion Q1).

Personal income increased by $54.8 billion (+0.3%, +4.4% Y/Y) in July, with tax-adjusted disposable personal income (DPI) up $52.5 billion (+0.3%, +4.4% Y/Y), and tax and inflation adjusted real DPI up +0.2% (+2.6% Y/Y). The savings rate dropped -0.1% to 6.7%, and Personal Consumer Expenditures (PCE) were up $49.3 billion (+0.4%), with the PCE price index increasing +0.1%, and the core PCE index, which excludes food and energy, up +0.2%. On a yearly basis, PCE inflation rose +0.1% to 2.3%, and core PCE inflation rose +0.1% to meet the +2.0% target level set by the Federal Open Markets Committee. On a yearly basis, consumer prices increased for energy (+13.4%), nondurable goods (+2.8%), and services (+2.7%), but fell for durable goods (-1.4%).

Upcoming Economic Reports:

Wednesday September 5 – International Trade

Friday September 7 – Employment Situation

Earnings Calendar:

 

Monday Tuesday Wednesday Thursday Friday
HDFC
Bank
(HDB)
Workday
(WDAY)
DocuSign
(DOCU)
Palo Alto
Networks
(PANW)
Genesco
(GCO)
NXStage
Medical
(NXTM)
Casey’s
General Stores
(CASY)
HD Supply
Holdings
(HDS)
Dell-VMWare
Tracking
(DVMT)
Grow
Condos
(GRWC)




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