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New home sales increased 2.3% month-over-month in December to a seasonally adjusted annual rate of 616,000 units (consensus 614,000) from a downwardly revised 602,000 (from 640,000) in November. On a year-over-year basis, new home sales were down 26.6%.
The key takeaway from the report is that it reflects how the pullback in mortgage rates has spurred some renewed demand among home buyers; however, affordability and supply pressures remain for many prospective buyers and that is holding back overall sales.
The weekly EIA Natural Gas Inventories showed a draw of 91 bcf following last week’s draw of 82 bcf.
Natural gas futures are down 6.2% to $2.73/mmbtu. On a related note, the S&P 500 energy sector is among the top performers, up 1.4%.
Into The Vortex – US Natural Gas Stocks Fall -91Bcf Vs Five Year Average -185Bcf
Dow 33,949.41 205.57 0.61%
S&P 500 4,060.43 44.21 1.10%
Nasdaq 11,512.41 199.06 1.76%
VIX 18.73 -0.35 -1.83%
Gold 1,929.90 -12.70 -0.65%
Oil 81.09 0.94 1.17%Equity indices in the Asia-Pacific region ended the week on a mostly higher note while markets in China remained closed for Lunar New Year but they will reopen on Monday.
—Equity Markets—
Japan’s Nikkei: +0.1% (+3.1% for the week)
Hong Kong’s Hang Seng: +0.5% (+2.9% for the week)
China’s Shanghai Composite: CLOSED (UNCH for the week)
India’s Sensex: -1.5% (-2.1% for the week)
South Korea’s Kospi: +0.6% (+3.7% for the week)
Australia’s ASX All Ordinaries: +0.3% (+0.6% for the week)Japan’s Tokyo Core CPI increased at its fastest pace since May 1981, but Japan’s Prime Minister Kishida said that inflation driven by domestic demand remains “feeble” and that a return to deflation should not be ruled out.
Japan’s government debt is expected to exceed quadrillion yen in fiscal 2026/27.
South Korea’s POSCO Holdings reported a 46.7% yr/yr drop in 2022 profit resulting from a four-month suspension of its operations.
Japan’s January Tokyo CPI 4.4% yr/yr (last 4.0%) and Core CPI 4.3% yr/yr (expected 4.2%; last 4.0%)
South Korea’s February Manufacturing BSI Index 66 (last 71)
Singapore’s Q4 URA Property Index 0.4% qtr/qtr (last 3.8%)
Australia’s Q4 PPI 0.7% qtr/qtr (expected 1.7%; last 1.9%); 5.8% yr/yr (expected 6.3%; last 6.4%). Q4 Import Price Index 1.8% qtr/qtr (last 3.0%) and Export Price Index -0.9% qtr/qtr (last -3.6%)
New Zealand’s January ANZ Business Confidence -52.0 (expected -64.2; last -70.2)Major European indices trade in mixed fashion.
—Equity Markets—
STOXX Europe 600: UNCH (+0.4% week-to-date)
Germany’s DAX: -0.2% (+0.4% week-to-date)
U.K.’s FTSE 100: UNCH (-0.1% week-to-date)
France’s CAC 40: -0.2%(+1.2% week-to-date)
Italy’s FTSE MIB: +0.3% (+2.1% week-to-date)
Spain’s IBEX 35: -0.1% (+1.2% week-to-date)Spain reported better than expected growth for Q4, fueling more hopes that the region could avoid a recession.
The British Chancellor of the Exchequer Hunt pushed back against calls for a tax cut from Conservative politicians.
Norway is reportedly looking to implement a mechanism to limit power exports.
Eurozone’s December loans to nonfinancials 6.3% yr/yr (expected 8.6%; last 8.4%) and private sector loans 3.8% yr/yr (last 4.1%)
France’s January Consumer Confidence 80 (expected 83; last 81)
Italy’s November Industrial Sales 0.9% m/m (last -0.8%); 11.5% yr/yr (last 12.5%)
Spain’s Q4 GDP 0.2% qtr/qtr (expected 0.1%; last 0.2%); 2.7% yr/yr (expected 2.2%; last 4.8%)Visa (V 227.00, +2.29, +1.0%): beats by $0.17, beats on revs
L3Harris (LHX 202.00, +5.46, +2.8%): misses by $0.01, beats on revs; guides FY23 EPS in-line, revs in-line
Intel (INTC 27.22, -2.87, -9.5%): misses by $0.10, misses on revs; guides Q1 EPS below consensus, revs below consensus
KLA Corporation (KLAC 409.38, -19.38, -4.5%): beats by $0.29, beats on revs; guides Q3 EPS midpoint below consensus, revs midpoint below consensus
Hasbro (HAS 60.15, -3.63, -5.7%): guides Q4 below consensus; cites a challenging holiday consumer environment; COO to step down; to eliminate approximately 15% of its workforce and implement leadership and other organizational changes
Chevron (CVX 184.83, -2.96, -1.6%): misses by $0.20, beats on revs
Colgate-Palmolive (CL 73.10, -2.43, -3.2%): reports EPS in-line, beats on revs; guides FY23 EPS in-line, revs in-line
American Express (AXP 163.82, +7.94, +5.1%): misses by $0.17, reports revs in-line; guides FY23 EPS above consensus, revs above consensus; plans dividend increase
Charter Comm (CHTR 400.00, -10.39, -2.5%): misses by $1.26, reports revs in-line
Eastman Chemical (EMN 88.90, -2.85, -3.1%): misses by $0.35, misses on revs; guides FY23 EPS above consensusPersonal income was up 0.2% month-over-month in December, as expected, and personal spending was down 0.2% month-over-month (consensus -0.1%) following a downwardly revised 0.1% decline (from +0.1%) in November. Real personal spending declined 0.3% month-over-month in December.
The PCE Price Index was up 0.1% month-over-month (consensus 0.0%) and the core-PCE Price Index, which excludes food and energy, was up 0.3%, as expected. That left the year-over-year changes at 5.0% and 4.4%, respectively, versus 5.5% and 4.7% in November.
The key takeaway from the report is that it showed a continued moderation of inflation pressures, although the inflation rates are still too high for the Fed’s liking — particularly services inflation which was up 0.5% month-over-month following a 0.3% increase in November — and will keep the Fed in a vigilant, inflation-fighting mode.
The S&P 500 futures are down 13 points and are trading 0.3% below fair value.
The Nasdaq 100 futures are down 61 points and are trading 0.5% below fair value.
The Dow Jones Industrial Average futures are down 5 points and are trading roughly in line with fair value.The 2-yr Treasury note yield is up three basis points to 4.21% and the 10-yr note yield is up six basis points to 3.54%.
The U.S. Dollar Index is up 0.2% to 102.05.
January 29 – Feb 4, 2023 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The W
[See the full post at: Traders Market Weekly: Big Three Central Banks Resolve to be Tested.]
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