Data Analysis

October 1st, 2015 10:33 am | by John Jansen |

Via Stephen Stanley at Amherst Pierpont Securities:

The 10:00 data round emphasizes the diverging fortunes of various sectors of the U.S. economy.  The manufacturing sector remains exposed to the global situation, with both the stronger dollar and cooling demand in China and other places dampening activity for U.S. factories.  The September ISM survey report recap is attached.

Meanwhile, anything exposed mainly to the domestic economy and in particular to the U.S. household sector remains robust.  Consumer spending posted a 3.6% real gain in the second quarter and may have registered a similarly stellar performance in Q3.  There were high expectations for September auto sales (most industry experts were looking for steady sales in the neighborhood of August’s 17.7 million unit annualized clip) and so far, if anything, sales have exceeded even those lofty expectations, a noteworthy result in the face of VW’s travails and the supposed nervousness of consumers.

Moreover, construction spending in August was also solid.   Outlays were up 0.7% on the month, with a 1.3% jump in housing-related expenditures leading the way (private nonresidential and public outlays were both up modestly).   Housing and nonresidential construction (business investment in structures) are on pace to both post substantial gains in Q3, helping to drive another 3%+ quarter for real final domestic demand.

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