Global Macro Perspectives
Initial jobless claims in the U.S. were reported at 445.000 vs. 410.000 consensus; last week revised (up 1.000) reading was at 410.000.
Again rising; the fall in initial jobless in last few weeks claims was obviously a product of holiday spirit.
U.S. producer price index rose 1.1% in December vs. 0.8% consensus. November reading was also at 0.8%. On year level PPI is up 4.1%.
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The Ceridian-UCLA Pulse of Commerce Index rose 2.4% in December after rising 0.4% in November.
Down 1.0%. It keeps going down…
NFIB Small Business Optimism Index for January was reported at 92.6 vs. consensus of 94.5 and prior reading of 93.2. The index is trending up, but it’s consistent with weak recovery.
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The most broad measure of money supply – M2 rose 19.7% YoY in December vs. 19.0% consensus and 19.5% rise in November.
Chinese banks issued CNY 480.8 billion of new loans in December vs. CNY 564.0 billion in November and consensus of CNY 360.0 billion. Total new loans for 2010 reached CNY 7.9 trillion vs. CNY 7.5 trillion annual target.
New loan issuance slowed down in December because banks tried to obey annual targets; Monetary expansion continues.
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Number of crude oil drilling rigs rose for 12; Number of natural gas drilling rigs fell for 5.
On world scale number of oil & gas drilling rigs rose for 76 in December.
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Baltic dry index fell 14.3% in the last two weeks; Capesize Index was down 20.5%; Panamax Index rose 4.9%; Supramax Index was down 10.2%; Handysize Index fell 7.1%.
Iron stockpiles & steel inventory mostly unchanged; Iron ore and steel prices stable. Today’s China trade balance data was weak and I would be careful until we find out whether is it government orchestrated year end slowdown or a genuine one.
China trade balance was reported at USD 13.1 billion vs. USD 22.9 billion in November and USD 20.8 billion consensus. Export and import growth were running at 17.9 and 25.6 percent vs. 34.9% and 37.7% in November.
Total accumulated surplus for 2010 was USD 185.6 billion vs. USD 198.2 in full year 2009.
Sharp decline in trade balance surplus and both export and import growth confirm what I already anticipated on freight rates. What is even worse there’s no recovery in freight rates in January (jet).
U.S. railroads originated 240,073 carloads, up 5.6% compared with the same week in 2010 and down 9.9% compared with 5-year average. Week over week change was -6.3%.
Again: Looks like railroad traffic is weakening more than warranted by seasonal effects.