In the US, earnings season continued—two-thirds of companies beat earnings targets so far and over half beat revenue estimates. US housing data were generally positive—January home sales rose 3.3% m/m, outpacing estimates. December home prices also increased, though fell short of expectations. Markit’s February US Flash Purchasing Managers’ Index (PMI) firmly indicated expansion in services and manufacturing, though fell below expectations. The Fed released minutes from its latest meeting—expectations for gradual rate increases remain intact.
United Kingdom Q4 2016 GDP was revised higher in its second release. The stronger posting was tied to better than expected consumption. February Europe Markit preliminary PMI ticked upward, beating targets in most regions and sectors. The French composite PMI—accounting for services and manufacturing—hit a record high in this economic cycle and Germany’s PMI neared four-year highs, signaling underappreciated economic strength on the continent. January core eurozone CPI rose 0.9% y/y, matching estimates.
January Japanese trade data disappointed, with export volumes falling 0.3% y/y. However, some of the decline was likely impacted by temporary factors such as the Chinese New Year. Otherwise, recent results in December and full-year 2016 were generally positive. January Chinese loan data continued slowing. Mexico’s Q4 2016 GDP grew 2.4% y/y, thanks to strong services output.
The US releases January durable goods orders data. President Trump will address Congress for the first time. The UK releases January home prices. Japan reports January retail sales and industrial production.
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Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses a Luxembourg tax basis. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.