July 16, 2021 Headlines

Treasury yields are up 2-4 bps across the curve this morning following a solid June retail sales report. Equity futures are up 22-38 bps ahead of the open, with tech leading the way amid the modest rate curve steepening. Retail sales rose 0.6% in June versus expectations of a 0.3% m/m decline, and ex-auto sales were up 1.3% (0.4% expected). The control group, which is the figure used in the GDP consumption calculation, rose 1.1% m/m, more than double expectations (0.5%). The June upside surprise was largely a result of downward revisions to May, and adjusting for the revisions, the June figures would be closer to the expected growth rates, which is still a solid month. As we discussed in our July Monthly Market Commentary, the most recent quarterly Fed report on household balance sheets painted a very healthy picture for consumption going forward following multiple rounds of fiscal stimulus as well as consumer deleveraging over the last 18 months (in aggregate). 

Jason Haley
Chief Investment Officer

Date Event Survey Actual Prior Revised
7/16/2021 Retail Sales Advance MoM -0.30% 0.60% -1.30% -1.70%
7/16/2021 Retail Sales Ex Auto MoM 0.40% 1.30% -0.70% -0.90%
7/16/2021 Retail Sales Ex Auto and Gas 0.50% 1.10% -0.80% -1.00%
7/16/2021 Retail Sales Control Group 0.40% 1.10% -0.70% -1.40%
7/16/2021 Business Inventories 0.50% — -0.20% —
7/16/2021 U. of Mich. Sentiment 86.5 — 85.5 —
7/16/2021 U. of Mich. Current Conditions 91 — 88.6 —
7/16/2021 U. of Mich. Expectations 85 — 83.5 —
7/16/2021 U. of Mich. 1 Yr Inflation 4.30% — 4.20% —
7/16/2021 U. of Mich. 5-10 Yr Inflation — — 2.80% —
7/16/2021 Total Net TIC Flows — — $101.2b —
7/16/2021 Net Long-term TIC Flows — — $100.7b —

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