Market indices all rallied off their intraday lows, flipping from red to green at the close, as did crude oil. VIX was muted, staying well above 30. NASDAQ was the best performer. Economic data (discussed below) may well be the driver.
Manufacturing data came in weak while trimmed PCE (an inflation gauge) collapsed to 3.1%, down from 6.3% in January of this year, following a core PCE number that fell to 5.2% from 5.3% the month prior.
• The NYSE Advance Decline Ratio saw advancers less than decliners on a 0.66 to 1 ratio. The NASDAQ showed advancers outpacing decliners on a 1.2 to 1 ratio.
• Fear that the Fed may make a policy mistake are now widely discussed, as investors question whether the Fed will not be able to act with as much Hawkish vigor as first anticipated.
Headlines of the Day
Two key economic data points will be released this week.
The Federal Reserve’s Federal Open Market Committee meeting’s monetary policy decision on Wednesday, and the Bureau of Labor Statistics’ April jobs report, out Friday.
U.S. Manufacturing Gauge Unexpectedly Falls to Lowest Since 2020
ISM purchasing managers index decreased to 55.4 in April. Measures of new orders, production, employment declined.
China Lockdowns Wreak Havoc on Economy as Xi Pledges Support
China’s COVID lockdowns are taking a significant toll on the economy and roiling global supply chains, with President Xi Jinping under pressure to deliver on pledges to support growth.
Volkswagen expects chip shortage to ease later in 2022
German carmaker Volkswagen expects a continued hit from a shortage of semiconductors this year, although it should be able to ramp up production in the second half of the year, Chief Executive Herbert Diess said on Wednesday.
German retail sales unexpectedly fall in March
German retail sales fell unexpectedly in March as the war in Ukraine leads to price increases, data showed on Monday.
Economic Data Results for 5-2-2022
ISM Manufacturing New Orders APR
The ISM Manufacturing New Orders subindex in the United States decreased to 53.5 points in April of 2022 from 53.8 points in the prior month. It is the lowest reading since a contraction in new orders in May of 2020.
Dallas Fed's trimmed PCE inflation gauge pulled back
Dallas Fed’s trimmed mean PCE inflation gauge pulled back considerably in March to 3.1% annualized rate; now well off recent peak of 6.3% in January 2022 but still above pre-pandemic average.
United States ISM Manufacturing Prices Paid
ISM Manufacturing Prices in the United States decreased to 84.60 points in April from 87.10 points in March of 2022.
United States Construction Spending
Construction spending in the US increased by 0.1 percent from the previous month to a seasonally adjusted annual rate of USD 1.731 trillion in March of 2022, slowing from a 0.5 percent advance in February and missing market expectations of a 0.7 percent gain.
Economic Data Due Tomorrow on 5-3-2022
JOLTs Job Openings MAR
JOLTs Job Quits MAR
Factory Orders MoM MAR
Get the In the Know - End of Day Market Wrap
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