EconomyxAI · Beige Book Sector Monitor April 2017Released April 19, 2017 |
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Conditions index +0.48 avg of 11 sectors, −2 to +2 |
| Outlook index +0.37 sectors with an outlook |
| Districts growing 12/12 per National Summary |
| Positive momentum 5/11 sectors improving |
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This release in brief The read | ■ | Released April 19, 2017, with information collected on or before April 10, 2017. | | ■ | All twelve districts expanded; moderate in Cleveland, Chicago, Kansas City, Dallas and San Francisco, modest elsewhere. | | ■ | Manufacturing grew modestly to moderately; light vehicle sales firmer but other retail softer; tourism picked up. | | ■ | Residential construction accelerated while home sales slowed on low inventory; loans rose in over half the districts; energy improved; labor tight with modest wage gains. |
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Sector prospects Where the 3–12 month view points Strongest prospects Energy
XLE
▲ Improving | +0.77 |
| Real Estate
XLRE
▲ Turning up | +0.64 |
| Financials
XLF
▲ Turning up | +0.58 |
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| Weakest prospects Health Care
XLV
▼ Turning down | −0.14 |
| Consumer Staples
XLP
▶ Steady | −0.05 |
| Communication Services
XLC
▶ Steady | −0.02 |
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All 11 GICS sectors, ranked Sector scoreboard | # | Sector | −1 0 +1 | Score | Signal | Now | Outlook | Mom. |
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| 1 | Energy
XLE | | +0.77 | Favorable | +1.17 | +0.78 | ▲ +0.62 | | 2 | Real Estate
XLRE | | +0.64 | Favorable | +1.20 | +0.50 | ▲ +0.36 | | 3 | Financials
XLF | | +0.58 | Favorable | +0.82 | +0.50 | ▲ +0.55 | | 4 | Information Technology
XLK | | +0.48 | Leaning Favorable | +0.63 | +0.77 | ▶ −0.12 | | 5 | Materials
XLB | | +0.47 | Leaning Favorable | +0.50 | +0.50 | ▶ +0.43 | | 6 | Industrials
XLI | | +0.43 | Leaning Favorable | +0.95 | +0.57 | ▶ +0.01 | | 7 | Consumer Discretionary
XLY | | +0.16 | Leaning Favorable | +0.25 | +0.50 | ▼ −0.33 | | 8 | Utilities
XLU | | −0.01 | Neutral | +0.00 | +0.00 | ▶ −0.07 | | 9 | Communication Services
XLC | | −0.02 | Neutral | +0.00 | +0.00 | ▶ −0.20 | | 10 | Consumer Staples
XLP | | −0.05 | Neutral | +0.00 | +0.00 | ▶ −0.22 | | 11 | Health Care
XLV | | −0.14 | Neutral | −0.25 | +0.00 | ▼ −0.34 |
Prospect Score blends current conditions, district outlooks, momentum, a sector-specific macro tilt and margins. Now = weighted current conditions; Outlook = n/a when too few districts gave one; Mom. = change vs the average of the two prior releases. |
National Summary, scored −2 to +2 Macro backdrop | Overall Economic Activity | | +0.75 |
All twelve districts expanded, split between modest and moderate. | Labor markets tight; modest wage growth broadening. | | Inflation Pressure (higher = headwind) | | +0.50 |
Prices rose modestly; input costs outpaced selling prices. | Loan volumes rose in more than half the districts. | Contacts generally optimistic; Cleveland manufacturers more upbeat. |
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Current conditions in each Fed district District by sector | BOS | NY | PHL | CLE | RIC | ATL | CHI | STL | MIN | KC | DAL | SF |
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| Information TechnologyXLK | +2 | · | · | · | · | · | · | · | · | +1 | · | +1 | | Health CareXLV | · | · | · | · | · | · | · | −1 | · | · | · | −1 | | FinancialsXLF | +1 | +1 | −1 | · | +1 | +1 | +1 | +1 | · | +1 | +1 | +1 | | Consumer DiscretionaryXLY | +1 | · | · | +1 | +1 | −1 | · | +1 | −1 | −1 | · | +1 | | Communication ServicesXLC | · | · | · | · | · | · | · | · | · | · | · | · | | IndustrialsXLI | +2 | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +2 | +1 | · | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | · | · | · | +1 | · | +1 | · | +1 | +1 | +1 | +2 | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | · | +1 | +1 | +1 | +1 | +1 | +1 | +1 | · | +1 | +1 | +2 | | MaterialsXLB | · | · | · | +1 | · | · | +1 | +1 | +1 | +1 | +1 | · |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Energy +2 Dallas Energy sector picked up notably. Why it matters: Dallas carries the largest Energy weight. | Information Technology +1 San Francisco Semiconductors healthy; record demand for cloud engineers. Why it matters: SF carries 47% of IT weight. | Industrials +2 Kansas City Manufacturing strong in metals, electronics and aircraft. Why it matters: Largest Industrials positive. | Information Technology +2 Boston Software firms reported incredible orders. Why it matters: Adds to IT strength. | Industrials +2 Boston Every manufacturer contacted reported higher revenue. Why it matters: Second strong Industrials read. | Real Estate +2 San Francisco Real estate activity strong. Why it matters: SF carries large Real Estate weight. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Expanded modestly. |
| New York Growing +0.5 Outlook ▲ Continued to expand modestly. |
| Philadelphia Growing +0.5 Outlook ▲ Grew at a modest pace. |
| Cleveland Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
| Richmond Growing +0.5 Outlook ▲ Expanded modestly. |
| Atlanta Growing +0.5 Outlook ▲ Expanded at a modest pace. |
| Chicago Growing +1.0 Outlook ▲ Grew at a moderate pace. |
| St. Louis Growing +0.5 Outlook ▲ Expanded at a modest pace. |
| Minneapolis Growing +0.5 Outlook ▲ Grew modestly. |
| Kansas City Growing +1.0 Outlook ▲ Expanded moderately. |
| Dallas Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
| San Francisco Growing +1.0 Outlook ▲ Continued to expand at a moderate pace. |
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Where the signal is thin or split Divergences to watch | Information Technology — San Francisco +1 at 47% weight plus Boston +2 keeps the weighted IT score above the unweighted average.
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| | Energy — Dallas +2 with the largest Energy weight lifts the weighted score well above the unweighted average.
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How to read this. Each Fed district’s report is scored −2 (strong contraction) to +2 (strong expansion) for each GICS sector, then weighted by the district’s share of that sector’s activity. The Prospect Score blends current conditions (25%), district outlooks (35%), momentum (20%), a sector-specific macro tilt (10%) and margin pressure (10%). The Beige Book describes regional activity, not earnings or valuations. Weights and sensitivities are illustrative. This newsletter is for information only and is not investment advice. Source: Federal Reserve Beige Book · Scored by EconomyxAI |