April 29, 2021 Headlines

Risk markets are off to a strong start today following another dovish FOMC meeting, strong tech earnings, and a strong Q1 GDP report.  U.S. equity futures are up 50-110 bps ahead of the open, and Treasury yields are 3-4 bps higher for intermediate and long-end maturities. The Fed made very few changes to their official statement yesterday, and Chair Powell repeated that it’s not time yet for the Committee to even discuss tapering Fed bond purchases, much less rate hikes. As expected, Powell also reiterated the Fed’s belief that any near-term inflation will be transitory and reflective of base effects (year-over-year comparisons) and supply chain bottlenecks as economies reopen. The FOMC also chose to leave the IOER rate unchanged at 0.10%.

The first estimate of Q1 GDP showed growth rising 6.4% quarter-over-quarter (annualized), just below the 6.7% median economist survey rate by Bloomberg. The headline figure was negatively impacted by a big drawdown in inventories, which subtracted 2.6 percentage points from topline growth, and the price index (inflation gauge) was 1.5 points higher than expected at 4.1%. Personal consumption rose 10.7% in Q1 versus 10.5% expected and up from 2.3% in Q4. It was all about goods consumption in Q1, which jumped a massive 23.6% (-1.4% in prior quarter), and it would be a safe bet that stimulus checks played a part in this surge. Services consumption was more tepid at 4.6% (4.3% in prior quarter), but this component is expected to jump in Q2 and Q3 as the economy opens further.

Jason Haley
Chief Investment Officer

04/26/21Durable Goods Orders2.30%0.50%-1.20%-0.90%
04/26/21Durables Ex Transportation1.60%1.60%-0.90%-0.30%
04/26/21Cap Goods Orders Nondef Ex Air1.70%0.90%-0.90%-0.80%
04/26/21Cap Goods Ship Nondef Ex Air1.50%1.30%-1.10%
04/26/21Revisions: Retail Sales
04/26/21Dallas Fed Manf. Activity3037.328.9
04/27/21FHFA House Price Index MoM1.00%0.90%1.00%
04/27/21S&P CoreLogic CS 20-City MoM SA1.10%1.17%1.20%1.25%
04/27/21S&P CoreLogic CS 20-City YoY NSA11.80%11.94%11.10%11.12%
04/27/21S&P CoreLogic CS US HPI YoY NSA11.97%11.22%
04/27/21Conf. Board Consumer Confidence113121.7109.7109
04/27/21Conf. Board Present Situation139.6110110.1
04/27/21Conf. Board Expectations109.8109.6108.3
04/27/21Richmond Fed Manufact. Index221717
04/28/21MBA Mortgage Applications-2.50%8.60%
04/28/21Advance Goods Trade Balance-$88.0b-$90.6b-$86.7b-$87.1b
04/28/21Wholesale Inventories MoM0.50%1.40%0.60%0.90%
04/28/21Retail Inventories MoM-0.10%-1.40%0.00%0.10%
04/28/21FOMC Rate Decision (Lower Bound)0.00%0.00%0.00%
04/28/21FOMC Rate Decision (Upper Bound)0.25%0.25%0.25%
04/28/21Interest Rate on Excess Reserves0.10%0.10%0.10%
04/29/21Initial Jobless Claims540k553k547k566k
04/29/21Continuing Claims3590k3660k3674k3651k
04/29/21GDP Annualized QoQ6.70%6.40%4.30%
04/29/21Personal Consumption10.50%10.70%2.30%
04/29/21GDP Price Index2.60%4.10%2.00%
04/29/21Core PCE QoQ2.40%2.30%1.30%
04/29/21Langer Consumer Comfort54.2
04/29/21Pending Home Sales MoM4.40%-10.60%
04/29/21Pending Home Sales NSA YoY27.50%-2.70%
04/30/21Employment Cost Index0.70%0.70%
04/30/21Personal Income20.00%-7.10%
04/30/21Personal Spending4.20%-1.00%
04/30/21Real Personal Spending3.70%-1.20%
04/30/21PCE Deflator MoM0.50%0.20%
04/30/21PCE Deflator YoY2.30%1.60%
04/30/21PCE Core Deflator MoM0.30%0.10%
04/30/21PCE Core Deflator YoY1.80%1.40%
04/30/21MNI Chicago PMI6566.3
04/30/21U. of Mich. Sentiment87.586.5
04/30/21U. of Mich. Current Conditions97.2
04/30/21U. of Mich. Expectations79.7
04/30/21U. of Mich. 1 Yr Inflation3.70%
04/30/21U. of Mich. 5-10 Yr Inflation2.70%

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