We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here we are at Halloween weekend, but we’ve definitely seen spookier markets of late. In fact, this morning’s data actually set pre-market activity more positive, even though it may be debatable regarding how much this should be the case. The Dow went from -80 points to +76 this morning, the S&P 500 melted up from -30 points to -10 and the Nasdaq moved from -150 points to -80.
What’s behind this move to the positive? September's Personal Consumption Expenditures (PCE), of course. A higher month-over-month headline of +0.4% was 10 basis points (bps), with +0.6% Spending 20 bps higher than estimates. (Even though these exceeded expectations, it’s still half of June’s +1.2%.) Real Consumer Spending was also 10 bps hotter than expected, +0.3% month over month.
The main aspect of these relatively complex series of consumption numbers is the Deflator series, which wind their way up into different aspects of U.S. economic gauges. Month over month here, we see an in-line +0.3%, same as in August, with year-over-year coming in a tick lower than expected at +6.2%. These are some of the important inflation metrics that many people overlook — though they are important.
Core Deflator — stripping out volatile food and energy prices — reached +0.5%, in-line with expectations but only 10 bps off cycle highs in June. Year over year Core Deflator was up 20 bps to +5.1%, though still off cycle highs of +5.4% registered in February, which was the highest print since 1983. Headline Deflator year over year was +6.2%, 10 bps lower than expected.
What does all this mean? Inflation is still high. Is it desperately high where the Fed’s methods have been unable to touch them? Not necessarily. For one thing, these PCE figures take a lot into account. These levels work their way through the economy over time, and thus are among the last to show results of inflation-fighting measures. That there is some semblance of progress from taut inflationary highs should, ultimately, be encouraging.
We also had a large batch of Q3c earnings results come through this morning, but only have time for a quick peek: ExxonMobil (XOM - Free Report) was mixed in its Q3 report this morning, handily beating earnings to $4.45 per share from $3.88 consensus (and well ahead of the $1.58 posted in the year-ago quarter). Revenues of $112.07 billion was -2.71% below the Zacks consensus, but far surpassing the $73.70 billion from the previous year’s quarter. Yet shares are +2% in today’s pre-market. For more on XOM’s earnings, click here. Questions or comments about this article and/or its author? Click here>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Halloween Weekend Brings Less-Spooky Markets
Friday, October 28, 2022
Here we are at Halloween weekend, but we’ve definitely seen spookier markets of late. In fact, this morning’s data actually set pre-market activity more positive, even though it may be debatable regarding how much this should be the case. The Dow went from -80 points to +76 this morning, the S&P 500 melted up from -30 points to -10 and the Nasdaq moved from -150 points to -80.
What’s behind this move to the positive? September's Personal Consumption Expenditures (PCE), of course. A higher month-over-month headline of +0.4% was 10 basis points (bps), with +0.6% Spending 20 bps higher than estimates. (Even though these exceeded expectations, it’s still half of June’s +1.2%.) Real Consumer Spending was also 10 bps hotter than expected, +0.3% month over month.
The main aspect of these relatively complex series of consumption numbers is the Deflator series, which wind their way up into different aspects of U.S. economic gauges. Month over month here, we see an in-line +0.3%, same as in August, with year-over-year coming in a tick lower than expected at +6.2%. These are some of the important inflation metrics that many people overlook — though they are important.
Core Deflator — stripping out volatile food and energy prices — reached +0.5%, in-line with expectations but only 10 bps off cycle highs in June. Year over year Core Deflator was up 20 bps to +5.1%, though still off cycle highs of +5.4% registered in February, which was the highest print since 1983. Headline Deflator year over year was +6.2%, 10 bps lower than expected.
What does all this mean? Inflation is still high. Is it desperately high where the Fed’s methods have been unable to touch them? Not necessarily. For one thing, these PCE figures take a lot into account. These levels work their way through the economy over time, and thus are among the last to show results of inflation-fighting measures. That there is some semblance of progress from taut inflationary highs should, ultimately, be encouraging.
We also had a large batch of Q3c earnings results come through this morning, but only have time for a quick peek: ExxonMobil (XOM - Free Report) was mixed in its Q3 report this morning, handily beating earnings to $4.45 per share from $3.88 consensus (and well ahead of the $1.58 posted in the year-ago quarter). Revenues of $112.07 billion was -2.71% below the Zacks consensus, but far surpassing the $73.70 billion from the previous year’s quarter. Yet shares are +2% in today’s pre-market. For more on XOM’s earnings, click here.
Questions or comments about this article and/or its author? Click here>>