Archive for financial brief

Monthly Market Brief- September

Each month, our Heritage Investment team publishes a market brief to provide an overview of the major factors influencing the US economy, including a summary of key sectors and the current positives & challenges.

Click Market Brief September 2016 for the September 2016 update.

Here are some key highlights:

POSITIVES
o While non-farm payrolls added a softer 151,000 jobs to the market in August, the 3-
month average of 232,000 job additions remains above the recovery average of 200,000
o Consumer confidence remains high which should bode well for near-term U.S.
economic growth
o According to Baker-Hughes, the North American rig count is down 50 rigs compared to last year
CHALLENGES
o With S&P 500 companies posting negative earnings growth for six consecutive
quarters, corporations are beginning to reduce share back buybacks and slow dividend
growth
o The economy-weighted manufacturing plus non-manufacturing composite index fell
from 55.1 to 51.2 in August, the lowest reading since January 2010
o While a 12% year-over-year decline in farm prices may bode well for consumers, costs
likely outweigh the benefits as already tight producer margins become tighter and
impact agricultural related companies through lower producer spending
o A labor shortage of nearly 200,000 unfilled construction positions is resulting in higher
builder costs and leaving entry-level homes in tight supply as builders are building more
expensive homes to try and maintain margins

 

Heritage Market Brief – May 2016

Each month, our Heritage Investment team publishes a market brief to provide an overview of the major factors influencing the US economy, including a summary of key sectors and the current positives & challenges.

Click here for the May 2016 update.

Here are some key highlights:

POSITIVES

o With a recent increase in fuel consumption, a series of supply disruptions, and production outages, global supply has somewhat rebalanced and driven crude oil prices to new 2016 highs

o The nation’s trade deficit narrowed more than expected to $37.4 billion and should positively impact second quarter 2016 GDP

o While consumer confidence remains somewhat mixed, future income expectations ticked up along with an increase in consumers expecting to buy a car or home within the next 6 months

o Labor markets continue to show strength as highlighted by a 7,500 decline in the four- week moving average of jobless claims to 269,500

CHALLENGES

o The World Bank once again lowered its global growth estimate by 0.5% to 2.4% citing a weaker outlook for commodity exporters and a challenging external environment with soft investment amid weaker growth prospects and elevated policy uncertainty

o The service sector, which is driven by the strength of the domestic consumer, is turning noticeably lower as indicated by a decline of 2.8 points in the ISM non-manufacturing index to 52.9 as well as a decline of 1.5 points in the services PMI to 51.3

o As wages continue to lag, inflation remains flat with the PCE Core Index struggling to meet the Fed’s 2% target

o The nation’s oil patch still remains in extended contractionary territory despite WTI surging 60% since February; as long as oil prices remain stable to increasing, these territories should start to benefit