Key with business words and rig equipment graphic icons relative to the oil and gas industry. (Photo: PPD/AdobeStock/JEGAS RA)
The Baker Hughes North America Rig Count was down 66 for the week ending March 22, as Canada continues to drag down the United States (US).
The U.S. rig count declined by 10 to 1016, but remains 21 rigs above the previous year. A new study finds the U.S. will overcome Saudi Arabia in 2019 as the world’s top oil exporter.
Rigs classified as drilling for oil in the U.S. declined by 9 rig to 824, but are still 20 rigs more than the prior year’s level. Rigs classified as drilling for gas fell by 1 to 192, which is 2 more than last year.
The rig count for Canada declined by 56 to 105, and remains 56 rigs below the previous year.
For Canada, rigs classified as drilling for oil fell another 48 to 49, and are now 44 fewer than one year ago. Rigs classified as drilling for gas were down by 7 to 56, which is 12 less than last year.
The Gulf of Mexico, while a subset of the U.S., is a separately counted component. It fell by 2 rigs to 20, which is 7 rigs higher than one year ago.
The Baker Hughes Rig Count tracks weekly changes in the number of active rigs classified as drilling for either oil or gas. Active rigs are essential for the exploration and development of oil and gas fields.
Lower Rates, Rising Wages and Confidence Advance Total Existing Home Sales 11.8 Percent
Real Estate Market Going Up Concept Illustration. (Photo: AdobeStock)
Existing home sales in the U.S. skyrocketed in February, the largest gain since December 2015 fueled by rising wages, higher confidence and lower mortgage rates.
Total existing-home sales–or, completed transactions that include single-family homes, townhomes, condominiums and co-ops–soared 11.8% to a seasonally adjusted annual rate of 5.51 million. Sales are now only down 1.8% from a year ago. They were 5.61 million in February 2018.
The consensus forecast was calling for 5.1 million, with forecasts ranging from 4.990 million to 5.470 million.
“A powerful combination of lower mortgage rates, more inventory, rising income and higher consumer confidence is driving the sales rebound,” Lawrence Yun, NAR’s chief economist said.
Worth noting, wages rose by 3% in the fourth quarter (Q4) 2018 for the first time since 2009, and have risen by 3% or more for 7 consecutive months. The 3.4% year-over-year wage gain in the February Employment Situation report is the largest since April 2009.
The median existing-home price for all housing types in February was $249,500, up 3.6 percent from February 2018 ($240,800). February’s price increase marks the 84th straight month of year-over-year gains.
“It is very welcoming to see more inventory showing up in the market,” Mr. Yun added. “Consumer foot traffic consequently is rising as measured by the opening rate of SentriLockÒ key boxes.”
Total housing inventory at the end of February rose to 1.63 million, a 3.2% gain from 1.59 million in January. Unsold inventory is at a 3.5-month supply at the current sales pace, down from 3.9 months in January but up from 3.4 months in February 2018.
Mr. Yun said the housing market in 2019 needs additional new housing in order to sustain demand. The previously reported Housing Market Index (HMI) found builder confidence soared in February and held steady with those gains in March, and had big expectations for the Spring.
“For sustained growth, significant construction of moderately priced-homes is still needed,” he said. “More construction will help boost local economies and more home sales will help lessen wealth inequality as more households can enjoy in housing wealth gains.”
A typical homeowner accumulated an estimated $8,700 in housing equity over the past 12 months and $21,300 over the past 24 months.
First-time buyers accounted for 32% of sales in February, up from 29% both last month and a year ago. NAR’s 2018 Profile of Home Buyers and Sellers – released in late 20184 – found the annual share of first-time buyers was 33%.
“We’re very happy to see homebuyers returning to the market, as the beginning of Spring represents a prime time to purchase a new home,” said NAR President John Smaby. “Potential buyers and sellers should seek out a local Realtor to stay abreast of the market and take advantage of the various housing benefits that are currently being extended during housing transactions.”
Regional Data
Existing-home sales numbers in the Northeast were flat at an annual rate of 690,000, or 1.5% above a year ago. The median price in the region was $272,900, up 3.8% from February 2018.
In the Midwest, existing home sales rose 9.5% to an annual rate of 1.27 million, about on par with 2018. The median price in the region was $188,800, up 5.4% from last year.
Existing home sales in the South soared 14.9% to an annual rate of 2.39 million in February, though are still down 0.4% from last year. The median price in the region was $219,300, up 2.5% from a year ago.
In the West, existing home sales skyrocketed 16.0% to an annual rate of 1.16 million in February, but still 7.9% below a year ago. The median price in the region was $379,300, a 3.0% gain from February 2018.
New York Stock Exchange (NYSE) Building in the Lower Manhattan Financial District, New York City. (Photo: Tomasz Zajda/AdobeStock/PPD)
Maybe investors needed a good night’s sleep to reassess the broadly bullish policy statement delivered by the Federal Open Market Committee (FOMC) Wednesday afternoon.
While the round trip price action in the last 2 hours on Wednesday set up a broadly lower opening Thursday, that early decline was very short lived. Within 20 minutes of the opening bell, market averages had reversed to go decidedly green, and never looked back.
Is the IPO Market Finally Back?
Investor optimism was charged by more than just a “closer look” at the FOMC policy statement. Levi Strauss & Co. (LEVI), completed a very well received initial public offering. In its first day of trading, LEVI, closed +$5.53, or +31% above the offering price of $17.00, and managed a modest gain of +$0.31 or +1.4% from its opening trade price of $22.22.
While this is only 1 day of trading in 1 stock, it’s the first meaningful Initial Public Offering (IPO) this year, and is likely to be followed by a steady parade of offerings the next 6 to 12 months.
Keep in mind the capital markets calendar has been at a standstill for nearly 6 months. During the market swoon in Q4 last year, issuers put plans on hold, followed by the government shutdown in January which shuttered the required regulatory review process by the SEC for nearly the first half of Q1.
LYFT is scheduled to complete its IPO next week, followed by UBER and Pinterest in early April. Beyond that we expect Initial Public Offerings from Slack Inc, WeWork, AirBnb and data mining company Palantir, could come to market during the next few months.
A healthy IPO market is a staple of any expanding economy and vibrant bull market. Let’s hope the forward calendar brings solid companies with mature and disciplined owners and managers, that will add value to their shareholders and the economy for the long term.
Technology Earnings Continue to Impress
Semiconductor stocks were particularly strong as the tech sub-sector and relevant ETFs rallied to a 9 month high. The catalyst here was clearly a very positive second quarter earnings report from Micron Technologies (MU) +$3.95, or +10% to $44.05.
From South Korea to Silicon Valley, the entire semiconductor space posted strong gains, highlighted by Advanced Micro Devices Inc. (AMD) gaining +$2.20 or +8% to $27.90, and Applied Materials Inc. (AMAT) rising +$2.03 or +5% to $41.60.
This helped fuel the outperformance we’ve seen from the entire technology sector this year.
The NASDAQ Composite (^IXIC) gained +1.4% to post its best closing price, 7838.96, since the first week of October. With just 6 trading days left in Q1, the NASDAQ leads all Major Market Averages with a QTD and YTD gain just over +18%. For March, the Nasdaq has a MTD gain of +2.5% after recovering from a -1.5% decline the first week of the month.
The Nasdaq composite at 7838.96 is now merely 3.3% from its all time closing high of 8109.69 from August 29 of last year.
Numerous NASDAQ stocks had impressive gains on the day, including NVIDIA; NVDA, +$9.60, or +5.5% to $184.00; Apple Inc. (AAPL) +$7.25, or +3.8% to $195.41, Align Technology; ALGN, +$15.00 or +4.5% to $280.70; and Microsoft MSFT, +$2.50, or +2.1% to an all time high of $120.00.
The S&P 500 (^SPX) gained just over 30 points, or +1.1% to settle at 2854.88, its highest close since October 9 of last year, while taking out Wednesdays intraday highs. The S&P closed within 2.5% of the all time closing high of 2930.75 set on September 20 of last year. The S&P 500 is now +2% for the month of March and +14% YTD.
With 6 trading days left in March, market averages are looking to close the month with a much more positive tone than they started. A week from today is also the last day of the First Quarter.
Next week could very likely be a back and forth tug of war between investors taking some well deserved trading profits, and managers looking to show minimal cash reserves at the end of a very strong quarter.
Labor Force Participation Influences the Unemployment Rate, Resulting in Methodological Gimmicks
An African American supporter of President Donald Trump holds up a Black for Trump sign during a rally in Tampa, Florida on Tuesday, July 31, 2018. (Photo: Laura Baris/People’s Pundit Daily)
Attend or watch a rally for President Donald Trump, and you will hear him tout the decline in the black unemployment rate. Under his administration, unemployment for African Americans has fallen to all-time lows, on multiple occasions.
Those who know and surround the president will tell you this is a matter of pride for him. Unsurprisingly, his critics will just as frequently claim the falling trend in black unemployment began under his predecessor, Barack Obama.
So, what’s the truth? Who’s right?
If we’re just looking at the reported monthly change in the black unemployment rate–or, the reported rate for all races–then it would appear the trend began under Mr. Obama. Let’s take a look at the civilian unemployment rates for all races, as well as black or African American.
When Mr. Obama entered the Oval Office in January 2009, the black unemployment rate stood at 12.7%, below a recession high of 15%.
According to the Bureau of Economic Analysis (BEA), the Great Recession ended in June 2009. That month, black unemployment fell marginally 0.2% from the recession high to 14.8%.
But it began to rise again as Americans entered the first holiday season since the recession. It shot up from 15.3% in September 2009 to 16.8% in March 2010, the highest recorded by the Labor Department (DOL) via the Bureau of Labor Statistics (BLS) since modern tracking in February 1999.
Following this period, the unemployment rate for African and all Americans does indeed begin to decline, albeit at a far less-than impressive pace juxtaposed to historical performances during a post-recession era.
As we can tell from the charted data above, the pace of recovery in the labor market was very weak under Mr. Obama. Unemployment for all groups struggled to make progress without significant reversals.
Black unemployment was as high as 14.2% as recently as June 2013, hitting resistance at around 8%. It only broke resistance levels as labor force participation declined. Let’s take a look at labor force participation, again, for all races.
The unemployment rate will decline if people exit the labor force, meaning workers retire or give up on the American Dream. As the labor participation rate declines, unemployment will decline.
That’s how BLS methodology works.
Under Mr. Obama, that trend was clear and his supporters sought to explain it away with demographic changes. That was partially true. Baby-boom retirements assuredly contributed, but it wasn’t the full picture.
When labor force participation and the equally important but less-cited employment-population ratio rises, and yet unemployment continues to fall as people enter the labor force, it’s a far stronger labor market.
Put plainly, it’s real.
It’s also worth pointing out the increase in labor force participation for all races after Mr. Obama’s tenure is occurring despite those dastardly demographic pressures.
As a result, we are seeing real wage growth for the first time since the Great Recession. Wages rose by 3% in the fourth quarter (Q4) 2018 for the first time since 2009, and have risen by 3% or greater for 7 consecutive months.
That’s real wage pressure as a result of a very tight labor market with very strong demand. The 3.4% year-over-year wage gain in the February Employment Situation report is the highest since April 2009.
The decline in the black unemployment rate under Donald Trump was and is being driven by positive labor market conditions. The decline under Barack Obama was largely a methodological gimmick.
Philly Fed Released the Only Regional Factory Survey to Show Contraction Last Month
A manufacturing assembly line at the Heinz factory in Pittsburgh, Pennsylvania. (Photo: Courtesy of Heinz)
The Philadelphia Fed Manufacturing Business Outlook Survey rose to 13.7 for March, nearly triple the consensus forecast. That’s up from a reading of -4.1 in February, which was the only regional factory report to show contraction.
The consensus forecast was 5.5, with forecasts ranging from a low of -2 to a high of 15.
The current new orders index improved modestly, increasing from -2.4 in February to 1.9 in March. The current shipments index increased 25 points to 20.0.
The firms continued to add to their payrolls this month. The current employment index, however, decreased from a reading of 14.5 in February to 9.6 this month.
Nearly 20% of the responding firms reported increases in employment, while 10% of the firms reported decreases in employment. The current workweek index remained positive and increased 6 points to 10.6.
Nearly 42% of the firms expect increases in activity over the next six months, while 20% expect declines. The future new orders index also fell 10 points, and the future shipments index decreased 19 points, while the future employment index ticked up 1 point to 24.9.
The percentage of firms expecting to increase employment over the next six months (38%) outpaced the percentage expecting employment (13%) to decline. The future capital spending index fell 12 points to 19.5, its lowest reading since November 2016.
Weekly Jobless Claims Sample Period Includes March Employment Situation Report
U.S. jobless claims graph on a tablet screen. (Photo: AdobeStock)
The Labor Department said advance seasonally adjusted jobless claims came in at 221,000 for the week ending March 16, stronger than the consensus forecast. That’s a decline of 9,000 from the previous week.
The consensus forecast was 225,000, with forecasts ranging from a low of 212,000 to a high of 243,000. Worth noting, the sample period partially includes the monthly jobs report for March, or Employment Situation.
The 4-week moving average was 225,000, a gain of 1,000 from the previous week’s revised average. The previous week’s average was revised up by 250 from 223,750 to 224,000.
The advance seasonally adjusted insured unemployment rate was unchanged at a very low 1.2% for the week ending March 9.
The advance number for seasonally adjusted insured unemployment declined 27,000 during the week ending March 9 to 1,750,000. The 4-week moving average was 1,772,500, an increase of 6,000.
No state was triggered “on” the Extended Benefits program during the week ending March 2.
The highest insured unemployment rates in the week ending March 2 were in Alaska (3.2), New Jersey (2.8), Montana (2.7), Connecticut (2.5), Rhode Island (2.5), California (2.4), Pennsylvania (2.4), Massachusetts (2.3), Illinois (2.2), and Minnesota (2.2).
The largest increases in initial claims for the week ending March 9 were in Illinois (+3,568), Ohio (+1,142), Washington (+896), Oregon (+869), and Texas (+661), while the largest decreases were in New York (-16,497), Kentucky (-1,668), Georgia (-615), Arkansas (-430), and Vermont (-415).
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The Democratic Party isn’t offering a plan to move the country forward, instead they merely want to change and destroy institutions, who and what we are.
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All bumper music and sound clips are not owned by the show, are commentary, and of educational purposes, or de minimus effect, and not for monetary gain.
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Recent Survey Finds Trump Leads Generic Democrat 46 to 40 Percent Cumulatively in Five Rust Belt States
Supporters of President Donald Trump hold up Make America Great American and Keep America Great signs A supporter of Donald Trump dons a T-shirt with a new twist on an old joke targeting Hillary Clinton during a rally in Tampa, Florida on Tuesday, July 31, 2018. (Photo: Laura Baris/People’s Pundit Daily)
With Democrats gearing up for their nomination, President Donald Trump will kick off a rally in Grand Rapids, Michigan, next Friday to shore up a coalition that won him historic victories. It will be the eighteenth rally he has held in the state and the sixth rally in Grand Rapids since he first announced his candidacy in June, 2015.
In November 2016, President Trump became the first Republican nominee for president to carry the Rust Belt states of Michigan and Pennsylvania since 1988, and the first to carry Wisconsin since 1984.
“President Trump looks forward to joining the great people of Michigan as he shares the successes of his administration and the work still left to be done,” said Michael Glassner, Chief Operating Officer for the campaign.
The president’s visit to the state Michigan is a clear sign he intends to fight to hold his narrow victory. Roughly 10,000 votes separated him from Hillary Clinton.
The Wall Street Journal recently surveyed Michigan, Pennsylvania, Indiana, Ohio and Wisconsin, and found the president “cumulatively leads a generic Democratic opponent, 46 percent to 40 percent.”
Big Media pundits didn’t even entertain the prospect of Blue Wall states cracking. Largely discredited, they’ve worked overtime since to redeem their opinions after blaming low turnout.
But dig a bit deeper–as the People’s Pundit did at the time–and that explanation doesn’t suffice.
“President Trump carried 12 counties that voted to reelect Mr. Obama in 2012, including Monroe, Bay, Eaton, Saginaw and Macomb,” Rich Baris, the People’s Pundit and Director of the PPD Election Projection Model said. “While there was a shortfall statewide, voter turnout actually increased around 4% in Macomb juxtaposed to 4 years prior.”
In an interview with DBusiness after the election, he pointed to a swing among Democratic seniors in the state as a key to Mr. Trump’s victory. It had a devastating impact on the party’s nominee.
Mrs. Clinton only won 8 counties, including Genesee, Ingham, Kalamazoo, Marquette, Muskegon, Oakland, Washtenaw and Wayne.
At first glance, it would appear the 2020 Democratic nominee could return the state to the Blue Wall if they perform at historical levels in Wayne County, alone.
“Sure, it’s possible. But that conclusion foolishly assumes the working class and suburban votes the winner left on the table also do not vote in 2020,” Baris added. “Political coalitions do not evolve in a vacuum.”
Meanwhile, the Trump campaign plans to put socialism on trial in 2020, and to tout the president’s record on jobs, the economy and trade.
“While President Trump has made good on his promises to American workers, 2020 Democrats are embracing radical socialist policies like the Green New Deal, which would raise taxes on all Americans and is opposed by the AFL-CIO because it would harm millions of its members and threaten their jobs,” Mr. Glassner added.
“While Democrat proposals would cause irreparable harm to the American economy, President Trump has added hundreds of thousands of manufacturing jobs in just two years, a drastic change from Obama’s disastrous two terms.”
Manufacturing industry production concept, depicting factory production on a conveyor belt with factory operational workers in uniform. (Photo: AdobeStock)
U.S. factory orders rose unexpectedly in January by $500.5 billion, 0.1% to beat the consensus. New orders for manufactured goods in the U.S. have now risen for two straight months.
The consensus forecast was looking for a flat zero, with forecasts ranging from a low of -3.0% to a high of 0.6%.
Shipments, which have been down now for four consecutive months, fell $1.8 billion or 0.4% to $503.1 billion. The decline follows a 0.2% decrease in December.
Unfilled orders, which are up following three consecutive monthly decreases, rose $1.4 billion or 0.1% to $1,181.9 billion. That followed a 0.1% drop in December.
The unfilled orders‐to‐shipments ratio was 6.57, up from 6.55 in December.
Inventories, up twenty‐six of the last twenty‐seven months, rose again $3.6 billion or 0.5% to $685.7 billion. That followed a 0.1% decline in December. The inventories‐to‐shipments ratio was 1.36, up from 1.35 in December.
New Orders
New orders for manufactured durable goods in January, which are up now for three consecutive months, increased $0.9 billion or 0.3% to $255.3 billion. That’s down from the advance estimate of +0.4% and followed a gain of 1.3% in December.
Transportation equipment, up five of the last six months drove the increase, $1.1 billion or 1.2% to $91.0 billion. New orders for manufactured nondurable goods decreased $0.5 billion or 0.2% to $245.2 billion.
Unfilled Orders
Unfilled orders for manufactured durable goods in January, which are up following three consecutive monthly decreases, increased $1.4 billion or 0.1% to $1,181.9 billion. This followed a decline of 0.1% for December.
Transportation equipment, also up now following three consecutive monthly decreases, led the gain, rising $0.9 billion or 0.1% to $811.6 billion.
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