Thursday, January 25, 2024

The Morning Call--Q4 GDP growth well above expectations

 

The Morning Call

 

1/25/24

 

The Market

         

    Technical

 

            Wednesday in the charts.

            https://www.zerohedge.com/markets/big-tech-bid-bonds-bullion-battered-better-data-made-doves-cry

 

            Downside protection reset lower.

            https://www.zerohedge.com/the-market-ear/inverse-fear-and-upside-pain

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

Weekly initial jobless claims totaled 214,000 versus expectations of 200.000.

 

Q4 GDP growth was reported at 3.8% versus predictions of 2.0%; GDP sales were +3.2% versus +2.5%; real consumer spending was up 2.8% versus +2.6%; the price indicator was +1.5% versus +2.3%; the core PCE price index was +2.0%, in line.

 

December durable goods orders were flat with November versus forecast of up 1.1%; ex transportation, they were +0.6% versus +0.2%.

 

The December Chicago national activity index fell 0.15% versus consensus of +0.1%.

 

The December trade balance was -$88.4 billion versus estimates of -$88.0 billion.

 

                          December building permits were up 1.8% versus projections of +1.9%.

 

The January flash manufacturing PMI was 50.3 versus expectations of 47.9; the flash services PMI was 52.9 versus 51.0; the flash composite PMI was 52.3 versus 50.3.

                          https://www.zerohedge.com/economics/pmi

 

                        International

 

The January German business climate index came in at 85.2 versus predictions of 86.7; the January current conditions index was 87.0 versus 88.6.

 

                        Other

 

                          Architecture billings remain soft.

                          https://www.calculatedriskblog.com/2024/01/aia-architecture-firm-billings-remain.html

 

            The Fed

 

              The Fed kills free money arbitrage scheme.

              https://www.zerohedge.com/markets/fed-suddenly-kills-banks-free-money-bailout-fund-arbitrage-scheme

                

              The ECB leaves rates unchanged.

              https://www.zerohedge.com/markets/ecb-keeps-rates-unchanged-sees-declining-trend-inflation-continuing

 

            Fiscal Policy

 

              National debt per household

              https://politicalcalculations.blogspot.com/2024/01/the-national-debt-burden-grows-for-us.html

 

            Inflation

 

              Profits do not cause inflation.

              https://www.aier.org/article/profits-do-not-cause-inflation-causal-fallacies-as-economic-ignorance/

 

            Recession

 

              Consumers will continue to power growth in 2024.

              https://www.bloomberg.com/news/articles/2024-01-24/us-gdp-data-will-showcase-consumer-set-to-power-economy-in-2024?srnd=premium&sref=loFkkPMQ

 

  And recent nowcasts support that view.

  https://www.capitalspectator.com/us-growth-slowdown-expected-for-thursdays-q4-gdp-report/

 

  A deeper dive into those EU PMI’s reported yesterday.

  https://www.pmi.spglobal.com/Public/Home/PressRelease/3dbb92c8f7ba426ebf4c4334a384183d

 

              How Houthi attacks are impacting the global supply chain.

              https://www.bloomberg.com/news/features/2024-01-24/red-sea-maps-show-houthi-attacks-hitting-global-economy?srnd=premium&sref=loFkkPMQ

 

     Bottom line

 

            S&P 500 percent of time at new all-time highs.

            https://www.bespokepremium.com/interactive/posts/think-big-blog/sp-500-percent-of-time-at-new-highs

 

And so is the rest of the world.

https://www.riskhedge.com/outplacement/the-world-is-breaking-out1/rcm

 

Stocks usually rally into Fed rate cut.

https://www.zerohedge.com/markets/dotcom-history-rhymes-nasdaq-fed-cuts-loom

 

    News on Stocks in Our Portfolios

 

General Dynamics press release (NYSE:GD): Q4 GAAP EPS of $3.64 beats by $0.02.

Revenue of $11.67B (+7.1% Y/Y) beats by $200M.

 

Canadian National Railway press release (NYSE:CNI): Q4 Non-GAAP EPS of C$2.02.

Revenue of C$4.47B (-1.5% Y/Y).

 

Canadian National Railway (NYSE:CNI) declares CAD 0.845/share quarterly dividend7% increase from prior dividend of CAD 0.790.

 

Becton, Dickinson (NYSE:BDX) declares $0.95/share quarterly dividend, in line with previous.

 

Sherman Williams press release (NYSE:SHW): Q4 Non-GAAP EPS of $1.81 beats by $0.01.

Revenue of $5.25B (+0.4% Y/Y) beats by $20M.

 

What I am reading today

 

            How to avoid becoming miserably rich.

            https://tonyisola.com/2024/01/how-to-avoid-becoming-miserably-rich/

 

 

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

 

 

 

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