Economic Data Deluge

Ahead of today’s opening bell, we see plenty of economic data to provide grist for the mill, both in today’s trading and outlook on the near- to mid-term U.S. economy, as we continue to grapple with the coronavirus pandemic. Initial and Continuing Jobless Claims, Housing Starts and Building Permits, and the Philly Fed join the latest batch of Q1 earnings reports this morning. Unfortunately, most of this data can be summed up in a word: bleak.

Initial Jobless Claims for the past week reached 5.245 million, surpassing the 5.0 million expected, but considerably lower than the 6.6 million reported in each of the two previous weeks. We now see 22 million Americans having lost their jobs within the past month. A little back-of-the-envelope math would put us around 15% unemployment currently.

Continuing Claims, reporting a week in arrears, finally is documenting some of this devastation hitting the labor market: 11.976 million extended unemployment claims is not only the highest on record (this data has existed since the late 1960s), but has nearly doubled from the previous all-time record high in early 2009, during the throes of the Great Recession. It also demonstrates growth in Continuing Claims of 7x the rate we saw in early March.

Housing Starts for March also fell by a record 22.3% to 1.216 million seasonally adjusted, annualized units, though not too far off the 1.29 million analysts had been expecting. It is still a precipitous fall from the 1.564 million reported for February. Building Permits — a forward indicator of future starts — actually performed better than projections to 1.353 million or -6.8%. Analysts had been looking for 1.25 million new permits, or a drop of 14.6%.

All this said, we are still looking at March figures. This is the month where “stay at home” orders from dozens of state governments brought almost all aspects of the economy to a standstill, but only after it was half-way over. Analysts project April and May numbers to be even worse. However, we’re still up year over year on both starts and permits currently, as existing homes are experiencing a shortage (driving up demand) and single-family home construction continues to lag.

The Philly Fed manufacturing index for April has also hit the tape this morning: -56.6 is the headline number, right around historic lows seen in 1980 and in the mid-70s. This was worse than the -37.5 expected, and well off the March figure of -12.7. On the other hand, this headline is better than that reported by the comparable Empire State index yesterday, which came in at -78.2. Both indexes point to deflationary impulses within manufacturing at two of the top cities in the U.S., which of course is not good news.

A quick roundup of Q1 earnings reports ahead of today’s open show Abbott Labs ABT — a company reportedly ready to supply testing for coronavirus in the U.S. population, which is very good news — beating expectations on both top and bottom lines in its Q1 report: 65 cents beat the Zacks consensus by a solid dime, while revenues of $7.73 billion beat the estimate by 8.38% and excelled past the $7.54 billion reported in the year-ago quarter. For more on ABT’s earnings, click here.

Mixed reports came in for Morgan Stanley MS and Rite Aid RAD this morning, however: Morgan Stanley reported 99 cents per share, below the $1.07 expected and the $1.33 from Q1 2019; Rite Aid posted a loss of 37 cents per share, beneath the -13 cents in the Zacks consensus and -20 cents from the year-ago quarter. However, revenues of $9.49 billion at Morgan and $5.73 billion for Rite Aid topped expectations by 4.5% and 1.2%, respectively.

For more on MS’ earnings, click here.

For more on RAD’s earnings, click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.