Week in Review 1.17.2020
January 21, 2020
Week in Review
Week Ending: Friday, January 17, 2020
Recap & Commentary
China reported 4Q19 GDP growth of 6.0%, bringing full-year 2019 growth to 6.1%. That was markedly slower than the 6.6% growth recorded in 2018 and the slowest pace since 1990. Economists are guardedly optimistic about China’s 2020 growth following the signing of the trade deal, an uptick in December’s economic data, the first increase in investment since June, and the government’s continued commitment to supporting growth.
Through Friday, 9% of S&P 500 companies had reported earnings, with 72% beating their consensus estimate. Earnings headlines for the week were dominated by many of the large money-center banks which generally reported strong earnings growth. With respect to the broader economy, JP Morgan CEO, Jamie Dimon, stated that “the US consumer continues to be in a strong positions” and that global growth has “stabilized, albeit at a lower level”. The current consensus forecast for 4Q19 earnings growth is -2.1% Y/Y.
Economic Bullet Points
Retail Sales increased by 0.3% in December, matching the consensus. On a y/y trend basis, retail sales were up 4.1%, the most since November 2018, but slightly below the average 4.3% gain per annum over the past decade.
Industrial Production fell -0.3% in December, down in three of the past four months. It fell at a -0.5% annual rate in Q4, and it was also down -1.0% from a year ago, the most since October 2016.
Housing Starts jumped 16.9% in December, the most since October 2016, to a 1.608 million unit annual rate, the highest level in 13 years.
Small Business Optimism fell 2.0 points in December but remains elevated.
Market Indices Week of 1/17
|U.S. Bond Market||0.1%|
|10-Year Treas. Yield||1.82%|
|WTI Oil ($/bl)||$59|
The Week Ahead
- Leading Economic Index
- Existing Home Sales
- Jobless Claims