Let's take a closer look at Thursday's employment report numbers on Full and Part-Time Employment.
We've updated our monthly workforce analysis to include Thursday's Employment Report for June. The unemployment fell to 11.1%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 4.8M.
The 20th century Baby Boom was one of the most powerful demographic events in the history of the United States. We've created a series of charts to show seven age cohorts of the employed population from 1948 to the present.
The S&P dropped at the end of last week and then started Monday high. The index hovered around a 65 point range the rest of the week. The index is up 0.70% from last Thursday and is down 2.44% YTD.
Note: This commentary has been updated with the latest numbers from Thursday's Employment Report. Consider: Today nearly one in three of the 65-69 cohort and one in five of the 70-74 cohort are in the labor force.
Here's an interesting set of charts that will especially resonate with those of us who follow economic and market cycles. Imagine that five years ago you invested $10,000 in the S&P 500. How much would it be worth today, with dividends reinvested but adjusted for inflation? The purchasing power of your investment has increased to $15,442 for an annualized real return of 8.72%.
The Labor Force Participation Rate (LFPR) is a simple computation: You take the Civilian Labor Force (people age 16 and over employed or seeking employment) and divide it by the Civilian Noninstitutional Population (those 16 and over not in the military and or committed to an institution).
This morning's seasonally adjusted 1.314M new claims, down 99K from the previous week's revised figure, was worse than the Investing.com forecast of 1.375M.
With the Q1 GDP Third Estimate, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 123.4%, down from 154.7% the previous quarter.
"Travel on all roads and streets changed by -25.5% (-72.9 billion vehicle miles) for May 2020 as compared with May 2019. Travel for the month is estimated to be 213.2 billion vehicle miles." The 12-month moving average was down 2.39% month-over-month and down 6.5% year-over-year. If we factor in population growth, the 12-month MA of the civilian population-adjusted data (age 16-and-over) was down 2.45% month-over-month and down 6.9% year-over-year.
The last couple of years have been remarkable ones for yields. As of June 30, the 10-year note is 12 basis points above its historic closing low of 0.54%, reached on March 9.
At present, multiple jobholders account for just 4.3 percent of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the current relative sizes of which we've illustrated in a pie chart.
Our monthly market valuation updates have long had the same conclusion: US stock indexes are significantly overvalued, which suggests cautious expectations on investment returns.
Here is a summary of the four market valuation indicators we update on a monthly basis.
The latest monthly employment report showed a gain of 4.8M nonfarm jobs, which consists of a gain of 4.296M service-providing jobs and a gain of 504K goods-producing jobs.
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through May, is now available.
Note: This update includes June close data.
The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Thursday's headline number of -54.6B was lower than the Investing.com forecast of -53.0B.
Here is the latest update of a popular market valuation method using the most recent Standard & Poor's "as reported" earnings and earnings estimates and the index monthly average of daily closes for the past month.
All eight indexes on our world watch list posted losses through July 6, 2020. The top performer is our own S&P 500 with a loss of 1.58%. China's Shanghai is in second with a loss of 2.15% and in third is Tokyo's Nikkei 225 with a loss of 3.98%. Coming in last is London's FTSE 100 with a loss of 16.66%.
What does the ratio of unemployment claims tell us about where we are in the business cycle and our current recession risk?
The moving average for the per-capita Light Vehicle Sales series peaked in 1986. Thirty-plus years later, it is now down 44% from that 1986 peak.
Quick take: At the end of June the inflation-adjusted S&P 500 index price was 119% above its long-term trend, up from 106% the previous month.
About the only certainty in the stock market is that, over the long haul, over performance turns into underperformance and vice versa. Is there a pattern to this movement? Let's apply some simple regression analysis to the question.
This commentary has been updated to include Thursday morning's release of Nonfarm Employment. June's 4.8M increase in total nonfarm payrolls had revisions that resulted in 90K more jobs than previously reported. The Investing.com consensus was for 3M jobs gained and the unemployment rate to decrease to 12.3%.
The Institute of Supply Management (ISM) has now released the June Non-Manufacturing Purchasing Managers' Index (PMI), also known as the ISM Services PMI. The headline Composite Index is at percent 57.1, up 11.6 from 45.5 last month. Today's number came in above the Investing.com forecast of 50.1 percent.
The June US Services Purchasing Managers' Index conducted by Markit came in at 47.9 percent, up 10.4 from the final May estimate of 37.5. The Investing.com consensus was for 46.7 percent.
Here's the latest on the three largest cryptocurrencies by market share: bitcoin, Ether, and XRP.
In response to a standing request, here is an updated comparison of four major secular bear markets. The numbers are through the Tuesday, June 30 close.
This morning's employment report for June showed a 4.8M increase in total nonfarm payrolls, which was above the Investing.com forecast of 3M.
Quick take: Based on the June S&P 500 average of daily closes, the Crestmont P/E is 119% above its arithmetic mean and at the 99th percentile of this fourteen-plus-decade monthly metric.
Was the March 2009 low the end of a secular bear market and the beginning of a secular bull? Are we in the beginning stages of another secular bear?
We've updated our periodic look at the Philly Fed ADS Index today's release which includes initial jobless claims through June 20 and the Third Estimate for Q1 GDP.
This morning the Institute for Supply Management published its monthly Manufacturing Report for June. The latest headline Purchasing Managers Index (PMI) was 52.6, an increase of 9.5 from 43.1 the previous month. Today's headline number was above the Investing.com forecast of 49.5 percent.
The June US Manufacturing Purchasing Managers' Index conducted by Markit came in at 49.8, up 10 from the 39.8 final May figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
Today we have the ADP June estimate of 2.369M nonfarm private employment jobs lost, a decrease over the ADP revised May figure of 3.065M.
Valid until the market close on July 31, 2020.
The S&P 500 closed June with a monthly gain of 1.84% after a gain of 4.53% in May. All three S&P 500 MAs are signaling "invested" and three of five Ivy Portfolio ETFs — Vanguard FTSE All-World ex-US ETF (VEU), Vanguard REIT Index ETF (VNQ), and Invesco DB Commodity Index Tracking (DBC) — are signaling "cash".
The headline number of 98.1 was an increase from the final reading of 85.9 for May. Today's number was above the Investing.com consensus of 91.8.
The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, rose to 36.6 in June from 32.2 in May, which is in contraction territory. Values above 50.0 indicate expanding manufacturing activity.
With today's release of the April S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.33% month over month which is cut to 0.16% with inflation adjustment.
The price of Regular and Premium are up four cents each from last week. According to GasBuddy.com, Hawaii has the highest average price for Regular at $3.14 and Mississippi has the cheapest at $1.81. The WTIC end of day spot price closed at 39.70, a decrease of 2.5% from last week.
Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month.
This morning the Dallas Fed released its Texas Manufacturing Outlook Survey (TMOS) for June. The latest general business activity index came in at -6.1, up 43.1 from -49.2 in May. All figures are seasonally adjusted.
Today the National Association of Realtors released the May data for their Pending Home Sales Index. According to the National Association of Realtors®, "Pending home sales mounted a record comeback in May, seeing encouraging contract activity after two previous months of declines brought on by the coronavirus pandemic."
FINRA has released new data for margin debt, now available through May. The latest debt level is up 5.3% month-over-month.
Personal Income (excluding Transfer Receipts) in May rose 1.56% and is down 5.5% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 1.46%. The real number is down 6.0% year-over-year.
The BEA's Core Personal Consumption Expenditures Chain-type Price Index for May, released this morning, shows that core inflation is below the Federal Reserve's 2% long-term target at 1.02%. The May Core Consumer Price Index release is higher at 1.22%. The Fed is on record as using Core PCE data as its primary inflation gauge.
This morning's release of the publicly available data from ECRI puts the WLI at 131.5, down 0.5 from the previous week. The WLIg is at -12.6, up 2.4 from last week and the WLI YoY is at -9.81, up from last week.
With the release of this morning's report on May Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal -4.91% month-over-month change in disposable income was at -5.00% when we adjust for inflation. This is a decrease from last month's 13.07% nominal and 13.59% real decreases last month. The year-over-year metrics are 8.28% nominal and 7.69% real.
The BEA's Personal Income and Outlays report for May was published this morning by the Bureau of Economic Analysis. The latest Headline PCE price index was up 0.10% month-over-month (MoM) and is up 0.55% year-over-year (YoY). Core PCE is below the Fed's 2% target rate.
The June Final came in at 78.1, up from the May Final. Investing.com had forecast 79.0.