Consumer sentiment rose in the initial February reading, coming close to the post-crisis peak in March 2018. This was a bit rosier than the January retail sales data, which were in line with expectations, though personal income growth was a bit more modest. The underlying data from the consumer still points to growth, although not exactly a break-neck speed.
Industrial production fell in January, hurt by the Boeing production halt. Aircraft production fell by 10.7%, the largest detractor to the headline of a 0.3% decline for the month. Other sectors were a mixed bag with some bright spots seen in automotive production offset by negative consumer goods production. This may be a signal that the ISM survey, which we noted last week, could dip back into contractionary territory again. This data point is relatively noisy, with significantly larger declines seen in the send half of 2015 and into 2016.
Coronavirus (or COVID-19 as it was officially named) is still very much in the news with some positive news surrounding signs of stabilizing infection numbers before a jump in reported cases crossed the news wires on Thursday. Some market participants attributed the virus for helping push long-dated Treasury yields to a record low at auction and expectations around potential global monetary or fiscal stimulus to assist in any growth setbacks.
Q4 earnings season is wrapping up and has been fairly positive, with companies generally beating expectations across a broad swath of sectors. Areas of strength included financials, utilities, health care, and technology. As expected, industrials and energy were among the weaker sectors on the back of several significant hurdles seen over the quarter