Daily Chartbook #23

Welcome back to PAV Chartbook: market charts, data, research, and insights pulled from various sources around the Internet by a solo retail investor.

1. Oil. OPEC+ production and capacity are not enough to meet quotas.

2. Home sales drop. Existing home sales fell 5.9% in July to 4.81 million, the lowest since May 2020. Sales have declined for 6 straight months.

3. Home inventories rising. Existing “inventory increased to 1.31 million in July from 1.25 million in June”.

4. Existing home inventory YoY. Existing inventory was virtually unchanged year-over-year, however.

5. Median prices up 10.8% YoY. From the NAR: “The median existing-home price for all housing types in June was $403,800, up 10.8% from July 2021 ($364,600), as prices increased in all regions. This marks 125 consecutive months of year-over-year increases, the longest-running streak on record.”

6. Sales by region (I). Here are existing home sales by region.

7. Sales by region (II). Month-over-month change in existing home sales by region.

8. Zillow on price growth. Zillow has cut its 2023 forecast for US home price growth. It now “projects U.S. house prices will rise 2.4% between July 2022 and July 2023”.

9. Financial conditions (I). Goldman Sach’s Global Financial Conditions Index has eased away from extreme tightening.

10. Financial conditions (II). The St. Louis Fed Financial Stress Index is showing the "lowest financial stress levels since 1993".

11. Leading indicator. The last time the Conference Board Leading Indicator declined for at least 5 straight months was before the 2008 Global Financial Crisis.

12. Global inflation. Here are the latest inflation rates around the world.

13. Revisiting college. Yesterday we noted that college tuition had declined for the first time in 30 years. There's still a long way to go to meet wage growth.

14. Supply chain (I). “The U.S. Supply Chain Index in July was back above neutral for the first time in nearly three years on the back of the continuing strong rebounds in inventories and capacity utilization.”

15. Supply chain (II). Tracking supply chain components shows there's plenty of room for improvement though.

16. Semis. Yesterday we mentioned the weak outlook for memory chips. Here are the inventory levels for some of the biggest chipmakers.

17. Jobless claims. New claims for unemployment benefits came in well under expectations at 250k (vs. 265k estimated), ending the long trend upward in new claims (for now).

18. Philly Manufacturing (I). The Philadephia Fed Manufacturing Index surprised to the upside and is back in expansion territory after two straight months of negative readings.

19. Philly Manufacturing (II). Responses to the business outlook survey “suggest steady conditions, on balance, in the region’s manufacturing sector”.

20. Philly Manufacturing (III). Business conditions improved but remained in contraction for the third straight month.

21. Philly Manufacturing (IV). Same story with new orders.

22. Philly Manufacturing (V). Prices paid by manufacturers are down to early 2021 levels.

23. Philly Manufacturing (VI). Employment (orange) moved higher.

24. Philly Manufacturing (VII). Unfilled orders dropped to their second lowest reading ever.

25. The rebound in the US10Y shows the market thinks Fed will shift sometime next year. From WSJ: “The 10-year U.S. Treasury yield has peaked before the federal-funds rate each time the Federal Reserve has raised interest rates the past few decades. Investors are divided on whether this time will be different.”

26. Great breadth. S&P 500 percentage of stocks above their 20-, 50- and 200-day moving averages:

• 20DMA (blue) = 87.5%

• 50DMA (red) = 92.2%

• 200DMA (purple) = 46.9%

27. Bull market coming? With the above in mind, here’s how the S&P does after more than 90% of stocks are above the 50-day moving average.

28. National Association of Active Investment Managers. The NAAIM Exposure Index has ticked down to 64 from above 70.

29. Retail YOLO. Retail investors’ share of options trades as a percentage of total orders has been rising.

30. Global consensus EPS estimates. From JPM: “Consensus EPS revisions are still experiencing an accelerating pace of EPS downgrades (-15%)…believe EPS expectations need to trough for a substantial recovery in cyclical and high risk parts of the market”.

31. Still strong. And finally, the S&P 500 is on pace for its 3rd best summer ever.