Rover's Weekly Market Brief - 09/22/2023

Introducing the Trade Evaluator

This week we want to highlight the Trade Evaluator, which is a brand new facility in Stock Rover V10 that shows you in detail how your trading decisions (buy and sells) have performed, answering the question was this trade a good idea or not?

The Trade Evaluator is very easy to use. You can read a quick blurb about it in our V10 announcement or get more detailed information in our help pages.

Economy

The U.S. Census Bureau reported new residential building permits were up 6.9% in August to a seasonally adjusted 1.543M, (-2.7%) below the August 2022 rate of 1.586M. Single-family permits were up (+2.0%) to 949K from a July figure of 930K. Single-family permits increased in the Northeast (+5.9%), Midwest (+2.6%), South (+1.8%), and West (+1.5%). Permits for 2 to 4 units reported up (+25.5%), while 5 units or more were up (+14.8%). Privately-owned housing starts dropped (-11.3%) to 1.283M, from a downwardly revised July estimate of 1.447M, and (-14.8%) below the August 2022 rate of 1.505M. Single-family starts were down (-4.3%) to 941K as single-family homebuilding decreased in the West (-26.9%), Midwest (-12.3%), and Northeast (-1.8%), while only the South (+8.1%) saw an increase. Housing starts for 5 units or more fell (-26.3%) to 334K in August, down (-41.0%) year over year. Privately-owned housing completions reported at 1.406M, up (+5.3%) from July’s upwardly revised 1.335M reading, and up (+3.8%) over August 2022. Single-family housing completions reported in at 961K, a (-6.6%) decrease from the July’s upwardly revised rate of 1.029M, down (-5.8%) from August 2022.

The Federal Open Market Committee (FOMC) announced the it would keep its benchmark federal funds rate in the range of between 5.25% to 5.5%. The central bank has raised its benchmark borrowing rate 11 times. The FOMC statement stated that “The Committee will continue to assess additional information and its implications for monetary policy. In determining the extent of additional policy firming that may be appropriate to return inflation to 2 percent over time”. The FOMC’s latest projections show the economy improving marginally and that there will likely be one more interest rate hikes before the end the year. The FOMC forecast increased the annual GDP growth to 2.1% for 2023 from a 1.0% forecast in June. The unemployment rate was revised down to 3.8% from a 4.1% forecast in June. The personal consumption expenditures (PCE) price index, was revised up to 3.3% from 3.2%. Core PCE which excludes the more volatile food and energy costs was revised down to 3.7% from 3.9%. The median projection for where the federal funds rate will be at the end the year was 5.6%, suggesting a one more quarter-point rate increase at either the November or December meetings. The median federal funds rate for 2024 was projected at 5.1%, up from June’s 4.6% forecast.

S&P Global reported that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell slightly to 50.1 in September from 50.2 in August. The headline reading fell for the fourth successive month, signaling a broad stagnation in activity across the private sector. Driving the slowdown was the service sector, where firms recorded the slowest rise in business activity in the current eight-month sequence of growth. Companies attributed the slowdown to high interest rates and inflationary pressures, which contributed to weakened client demand. Business confidence across the private sector dipped to a nine-month low at the end of the third quarter. On the positive side, job creation quickened to the fastest pace since May, with staffing increases in both manufacturing and services firms. The S&P Global Flash US Manufacturing PMI reported up slightly to 48.9, from 47.9 in August. Manufacturing firms continued to register a decline in production, albeit at a slower pace from August. Higher input inventories along with slower demand meant firms reduced their purchasing activity in September.

Upcoming Economic Reports:

Tuesday September 26 – New Home Sales (August)

Thursday September 28 – GDP (QoQ) (Q2)

Earnings Calendar:

 

Monday	Tuesday	Wednesday	Thursday	Friday
Pan Global Resources (PGZ.V)	Cintas (CTAS)	Micron Technology (MU)	CarMax (KMX)	Carnival (CCL)
Thor Industries (THO)	Costco Wholesale (COST)	Paychex (PAYX)	Nike (NKE)	Natuzzi (NTZ)