Fisher Investments recaps the biggest market, political and economic news from last week, including US GDP estimates, Japanese unemployment data and US durable goods figures.
In the US, the second estimate of Q1 2021 GDP remained unchanged at 6.4% q/q and 0.4% y/y, as expected. April durable goods orders fell 1.3% m/m, its first slip in 11 months and missing expectations for a 0.7% m/m increase. However, when excluding transportation-related orders, durable goods orders rose 1.0% m/m—higher than forecasts. To us, this suggests select factories in transportation (aircraft and autos) may be struggling to maintain output amid the current computer chip shortage, but the reach of this isn’t as widespread as many suggest. The semiconductor shortage is a well-known development weighing on certain industries—and one forward-looking stocks have likely digested and moved on from. April new home sales declined 5.9% m/m to an annualized rate of 863,000, lower than expected. Initial jobless claims for the week ending May 22 fell to 406,000—the lowest since the pandemic began.
In Japan, the April unemployment rate rose 2.8% from 2.6% in March, higher than consensus estimates.
The Week Ahead:
The US, UK, eurozone, China and Japan release May manufacturing and services purchasing managers’ indexes (PMIs). The US also releases May nonfarm payroll figures and the May unemployment rate. The eurozone reports May consumer prices, April retail sales, April money supply (M3) and the April unemployment rate. Japan reports April industrial production and retail sales figures and May consumer prices.
Tip of the Week:
Fisher Investments’ offices will be closed on Monday, May 31 in observance of Memorial Day. We will resume normal business hours on Tuesday, June 1.