Thursday, June 13, 2019
More economic data greets this Thursday’s pre-market indexes, with futures up on the Dow, Nasdaq and S&P 500. The usual Thursday Initial Jobless Claims are joined by new prints for May Import and Export prices. But the main headline is a developing story: two shipping tankers in the Gulf of Oman, outside Iran, have been attacked.
These attacks happened just south of the narrow Strait of Hormuz, which lies between Iran and Oman and the United Arab Emirates (UAE), and separates the Gulf of Oman from the Persian Gulf. Who is responsible for the attacks is not yet known, but it has sent oil prices up this morning — even the U.S.-based WTI and Brent indexes have risen 4% this morning. This is already the largest one-day gain since January.
Oil demand had been deteriorating globally of late, with slowing economies joining bolstered green energy initiatives in many countries. Motives for this attack are elusive at this point, save for entities looking to backstop oil prices from slipping further. Keep your newsfeeds open for updates on this event.
Initial Jobless Claims rose 3000 from an upwardly revised previous report to 222K last week. Still within the very cozy 200-225K weekly claims totals which have helped illustrate an historically robust jobs market, but towards the top-end of it. Still, it’s reassuring considering the weak Employment Situation report from the BLS last week, which posted a very low headline read on new jobs created.
Continuing Claims stayed about as steady as could be: 1.695 million is up ever so slightly from 1.69 million posted last week. Below 1.7 million still depicts historically low longer-term jobless claims; the narrative continues that employment is not on the list of current domestic economic problems.
May Import Prices month over month fell 0.3%, better than the -0.4% expected, but weaker than last month’s reported -0.1%. Stripping out petrol prices (the volatility of which can be surmised by the paragraphs above), we still see -0.3%, better than the -0.5% for April. Year over year, imports have fallen 1.5%, farther than the -1.2% read expected.
Export Prices dipped 0.2% month over month, in-line with estimates. This follows a gain of 0.1% the previous month. Year over year, exports are down 0.7%, deeper than the anticipated -0.2%. With U.S.-China trade tensions sustaining, these monthly reads are gaining a higher level of importance.
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