The Global Update

February 1

• US Indices advanced due to stronger than expected U.S. employment report, with nonfarm payrolls jumping by 304,000 jobs in January.
• This number not only exceeded forecasts but marked the largest gain since February 2018.

February 4

• The factory orders report declined by -0.6%, a few points below consensus expectation.
• Despite the sluggish start, indices advanced later in the afternoon with optimism that Q4 corporate earnings and 2019 outlook are off to a good start.

February 5

• ISM non-manufacturing sample reports sustainable and solid growth, at 56.7, which is within economist expectation.
• With news relatively light, markets may have risen due to support from S&P 500 Q4 results showing an average earnings growth rate of 12.4%.

February 6

• U.S. and China will start another round of trade talks next week.
• Nearly 71% of over half of the S&P 500 companies that have reported Q4 results have exceeded profit expectations.
• Despite this, analysts are reducing their earnings expectations for the first quarter of 2019.
• S&P 500 in January has been its strongest in over 30 years, a sign of potential market strength.

February 7

• U.S. indices fell due to weak economic news from Europe.
• Selling pressure may have been limited due to hopes that the US and China might be able to reach a trade deal in the upcoming talks.
• Initial jobless claims declined 19,000 to 234,000, higher than the 225,000 estimate.

February 8

• U.S. stock index futures advanced in anticipation of the latest trade talks between the U.S. and China in Beijing.
• Some analysts have expressed optimism that a trade deal may be reached by March 1.

February 11

• No major news today.
• US indices advanced somewhat slightly as the latest trade talks between the U.S. and China began in Beijing.
• 71.5% of the S&P 500 companies that have reported results have exceeded analyst estimates.

February 12

• US indices advanced as lawmakers reached a tentative deal to avert yet another partial government shutdown.
• Indices were also supported by expressed optimism on progress with the US-China trade talks.
• Markets moved higher despite reports that the National Federation of Independent Business small business optimism index continued its decline for a fifth straight month, falling to 101.2 in January from 104.4 a month ago. Economists were expecting a higher reading of 102.
• Job openings, as revealed in the latest JOLTS report, continue to accelerate much faster than hiring, up 3.1 percent to a 7.335 million, exceeding economist expectations of 6.900 million.

February 13

• Indices advanced partly on a report that President Trump intends to sign the border security deal to avoid another partial government shutdown.
• Additionally, markets were supported on optimism over the U.S.-China trade discussions.
• President Trump mentioned that he’s willing to relax the March 1 deadline if he and President Xi were close to an agreement.
• CPI remained unchanged, though, core prices grew 0.2% from December.

February 14

• Indices traded higher overnight due to signs of potential progress in U.S.-China trade talks.
• Several times during the week, President Donald Trump mentioned that discussions are going “very well.”
• Several sources are reporting that President Trump is may be extending the March 1 deadline by another 60 days in order to comprehensively iron out a trade deal.
• But indices quickly fell after a report that retail sales recorded their largest decline of 1.2% in more than nine years in December. Economists were expecting to see an increase rather than a decline.
• Jobless claims increased by 4,000 to 239,000, higher than consensus expectations.

February 15

• Indices continued trading higher on signs that progress in the Beijing trade talks is being made.
• Officials from both countries are planning to continue their talks in Washington next week.
• The NY Federal Reserves Empire State Manufacturing survey came in at 8.8, up from January’s reading of 3.9, and better than economist expectations of 7.1.
• The cost of US imports fell by 0.5% in January from the previous month. Economists forecasted a 0.3% decrease.
• Contrary to expectation of a rise in January industrial production, the report shows that it was down by 0.6%, and capacity utilization was 78.2% when 78.8% was anticipated.
• The end of the government shutdown helped Consumer Sentiment, which came in above consensus at 95.5.

February 18

• US Presidents Day

February 19

• Stocks opened lower after the EU threatened to retaliate if the US follows through with their threat to levy tariffs on imported EU goods.
• Indices continued advancing when President Trump said trade talks with China were going well, suggesting the possibility of pushing the deadline beyond March 1 to complete negotiations.
• Housing market index came in better than expected at 62. indicating recovery and strength in present sales–attributable by no small measure to low mortgage rates.

February 20

• Stock gains were subdued due to a few earnings reports that were more or less downbeat.
• Overall, stock market performance has been strong despite the current geopolitical environment surrounding it, a potential sign of long-term strength.

February 21

• US market lower today following a negative trading session in Europe plus some weaker-than-expected US economic data.
• Durable goods orders increased 1.2% in December, but the figure was smaller than the 1.5% gain that economists had expected.
• Initial jobless claims fell sharply to 216,000.
• Philadelphia Federal Reserve business index in February came in at -4.1, significantly lower than the expected consensus figure of 14.1.
• PMI composite came in at 55.8, though on a manufacturing level the figure came in at the lower end of 53.7 (consensus at 54.3) indicating potential “soft spot” in client demand, signalling a slowing in production most likely due to the current global economic slowdown.
• Existing home sales report came in slightly lower than expectations at 4.94 million (where 5.04 million was expected).

February 22

• Stocks moved higher today as signs that progress on trade offset the seemingly worsening global outlook.
• No major economic news or reports came in on this Friday.