10 Things You Need To Know: January 3, 2024
Key data releases this week include: ISM Manufacturing (Wed), JOLTS Job Openings (Wed), FOMC meeting minutes (Wed), factory orders (Fri), ISM Services (Fri), and nonfarm payrolls (Fri).
FHFA
December 26, 2023
U.S. house prices rose in October, up 0.3 percent from September, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index. House prices rose 6.3 percent from October 2022 to October 2023. The previously reported 0.6 percent price increase in September was revised to a 0.7 percent increase.
Haver
December 28, 2023
The Pending Home Sales Index, a forward-looking measure of home sales based on contract signings, was unchanged m/m at 71.6 in November after a 1.2% decline in October, according to the National Association of Realtors (NAR). The year-on-year rate of decline was -5.2% in November, less severe than -8.2% in October and -36.8% in November 2022.
Bloomberg
January 2, 2024
Chinese President Xi Jinping pledged to strengthen economic momentum and job creation, acknowledging some companies and citizens had endured a difficult 2023 in a rare admission of domestic headwinds facing the country. While China’s most-powerful leader since Mao Zedong used his annual new year address to trumpet his nation’s achievements, he also conceded some “enterprises had a tough time” and “people had difficulty finding jobs and meeting basic needs.”
Barron’s
January 1, 2024
The case for utilities starts with the industry’s profit outlook, which is the most favorable in decades due to the continuing buildout of wind and solar power and the upgrade of transmission networks. That could translate into annual earnings growth averaging 6% to 7% for the rest of the decade. Combine that with dividend yields averaging nearly 4% and annual total returns could be about 10% without any revaluation in the stocks.
Barron’s
January 1, 2024
The oil market is on the verge of a structural change that every energy investor needs to watch closely. Gasoline demand peaked in 2019 in the United States and will almost certainly keep falling. The same kind of decline is happening elsewhere, too. In fact, 2024 will likely be the last year of global gasoline demand growth before a long, slow decline.
Barron’s
January 1, 2024
The S&P 500 is on track for an earnings-per-share increase of about 3% in 2023, with eight out of 11 sectors reporting growth. Energy and materials firms saw the biggest declines, a natural follow-up to an unsustainably profitable 2022 buoyed by soaring commodity prices.
Bloomberg
December 29, 2023
Former Treasury Secretary Lawrence Summers said investors are probably underestimating inflation risk as markets move swiftly toward expectations for Federal Reserve easing. “I think there’s still a risk that the market is probably underestimating – that we’re not going to quite make as much progress on inflation as people hope, and that there’s not going to be quite as much room for Fed easing as people hope,” Summers said.
Bloomberg
January 2, 2024
Container shipping giant A.P. Moller-Maersk A/S said it will once again stop letting its vessels sail through the Red Sea, a vital trade corridor, after another of its carriers came under attack in the space of a few weeks. “We have decided to pause all transits through the Red Sea and the Gulf of Aden until further notice.”
Bloomberg
December 26, 2023
A Los Angeles office building located near Century City and Beverly Hills sold for about 52% less than its price five years ago. It’s the latest sale of an LA office building in a market that’s been pressured by the rise of remote work and financing challenges brought about by soaring interest rates.