/ American Executive Tax and Financial Services
October Newsletter
2013
American Executive Tax and Financial ServicesOctober Newsletter | Issue2 / 1Retail Sales
LSA Weekly
Retail sales for August gained a meager +0.2%, which disappointed a bit relative to the expected +0.5% increase. Removing auto and gasoline components brought the core sales number to +0.2%, which still trailed the anticipated number by a tenth. On the positive side, June’s gain was revised upward by a tenth, although we’re talking about fairly small numbers all the way around.
In August, apparel sales and building materials were disappointing, down almost a percent in the usually important back-to-school shopping and home construction seasons. On the positive side, autos and parts gained a percent, which explained the difference between the headline and core figures. Retail sales have been somewhat sporadic as they often are month-to-month, and have slowed as of late—although the more important twelve-month gain stands at +4.7%. This recent tempering of retail ‘consumerism’ may certainly be a factor in the Fed’s decision-making, being that consumers represent 70% of the economy.
Producer Price Index
LSA Weekly
The headline Producer Price Index for August rose +0.3% (+1.4% year-over-year), which was just a tick above forecast. The core PPI was flat (+1.1% year-over-year), compared to an anticipated +0.1% rise.
The difference between the two was entirely explained by gains in food and energy prices in the month. Similarly, import prices were flat in August, relative to an expected gain of +0.5%, with rising petroleum prices offset by falling capital and consumer goods imports. As seen by the year-over-year figures, inflation from these measures continue to appear subdued. The year-over-year decline of almost half a percent in import prices is especially low.
Consumer Price Index
LSA Weekly
The consumer price index for August rose +0.1%, about half of the expected increase (bringing year-over-year inflation to +1.5%). Stripping out food and energy, core CPI gained +0.13% compared to an anticipated +0.2% (12-month gain of +1.8%).
The amounts are so small these days that they’re practically quoted in hundredths of a percent. From an individual component level, airline prices fell -3% for the month, while medical services increased about a percent, and rent of primary residence gained just under a half-percent. However, changes overall were fairly minor
Industrial Production
LSA Weekly
Industrial production for August gained +0.4%, which was just a tick below consensus, and July’s figure was revised downward by a few tenths.
Manufacturing production, which is the bulk of the number, rose +0.7% on the back of stronger auto and auto parts production during the month. Auto assemblies have jumped to a post-recession high. Capacity utilization came in at 77.8%, which also underwhelmed expectations by a similar tick.
Existing Home Sales
LSA Weekly
Existing home sales for August again rose +1.7%, which was a pleasant surprise over the forecasted -2.6% drop after a big July reading. Single-family and co-op/condo sales posted nearly similar results, so no story here. The months’ supply of homes ticked down a bit to 4.9.
Unemployment
LSA Weekly
Initial jobless claims for the Sept. 14
week came in at 309k, which was far below consensus expectations for 330k.
However, it was too good to be true yet again, as the second week in a row
of claims reporting distortions convoluted the numbers due to state system upgrades.
Since California was one of the states behind the problem, the room for error could be significant. Continuing claims for the Sept. 7 week came in at 2,787k, which were also lower than the 2,900k expected. However, due to the missing data, the entire report should probably be disregarded for now.
Factory Orders
LSA Weekly
Factory orders fell -2.4% in July, but were slightly better than the expected drop of -3.4%.
Both core capital goods orders and shipments were revised downward somewhat for the previous months as well, but manufacturing inventories rose a few tenths of a percent.
Melisa’sCorner
Melisa M Murphy
Autumn is upon us; nature's grand finale for the year! Fall is one of my favorite times of the year. The mornings are crispier, which is a welcome change for me.
In the past few months I've taken time to reach out for education, because knowledge, as we all know, is power! It has been enjoyable and I have learned many new ideas, and refreshed some old ones. We have a lot in store for our clients so keep looking out for fun events on the horizon.
My family and I closed the summer with a trip to Orlando over Labor Day. We spent a nice relaxing weekend sitting around a beautiful pool!! That's my kind of vacation!!!
We are working on the client appreciation event set for November 7th, and hope to see each and everyone there!
Aloha!
Go Rays!!
Securities offered through Investors Capital Corporation, member FINRA/SIPC. 6 Kimball Lane, Lynnfield MA, 01940 800.949.1422. Advisory services offered through Investors Capital AdvisoryThe market commentary articles provided were generated by LSA Portfolio Analytics (‘LSA Weekly’) and do not necessarily represent the views of the namedrepresentative or named Broker dealer.
American Executive Tax and Financial ServicesOctober Newsletter | Issue2 / 1
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