EconomyxAI · Sector Watch February 2013Released March 6, 2013 |
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Conditions index +0.39 avg of 11 sectors, −2 to +2 |
| Outlook index +0.23 sectors with an outlook |
| Districts growing 12/12 per National Summary |
| Positive momentum 7/11 sectors improving |
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This release in brief The read | ■ | Released March 6, 2013, with information collected on or before February 22, 2013. | | ■ | Activity generally expanded at a modest to moderate pace; Boston grew slowly and Chicago at a slow pace. | | ■ | Consumer spending expanded in most districts though retail slowed in several, with the payroll tax increase and gas prices cited; auto sales strong and tourism strengthened. | | ■ | Manufacturing modestly improved in most regions, residential real estate strengthened with rising prices, loan demand stable to higher, and coal production fell. |
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Sector prospects Where the 3–12 month view points Strongest prospects | Real Estate
XLRE
▶ Steady | +0.60 |
| Industrials
XLI
▲ Improving | +0.52 |
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| Weakest prospects Consumer Staples
XLP
▶ Steady | −0.08 |
| Utilities
XLU
▶ Steady | +0.01 |
| Health Care
XLV
▶ 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 | | +0.60 | Favorable | +0.82 | +0.72 | ▶ +0.40 | | 2 | Real Estate
XLRE | | +0.60 | Favorable | +1.05 | +0.59 | ▶ +0.21 | | 3 | Industrials
XLI | | +0.52 | Favorable | +0.64 | +0.56 | ▲ +0.69 | | 4 | Financials
XLF | | +0.36 | Leaning Favorable | +0.63 | +0.46 | ▶ +0.34 | | 5 | Communication Services
XLC | | +0.22 | Leaning Favorable | +0.40 | +0.00 | ▲ +0.39 | | 6 | Information Technology
XLK | | +0.19 | Leaning Favorable | +0.30 | +0.00 | ▶ +0.38 | | 7 | Materials
XLB | | +0.17 | Leaning Favorable | +0.21 | +0.00 | ▲ +0.19 | | 8 | Consumer Discretionary
XLY | | +0.10 | Neutral | +0.48 | +0.06 | ▼ −0.15 | | 9 | Health Care
XLV | | +0.02 | Neutral | −0.07 | +0.10 | ▶ −0.04 | | 10 | Utilities
XLU | | +0.01 | Neutral | +0.00 | +0.00 | ▶ +0.00 | | 11 | Consumer Staples
XLP | | −0.08 | Neutral | −0.15 | +0.00 | ▶ −0.18 |
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 | | +0.50 |
Five districts moderate, five modest, two slow. | Labor market conditions generally improved modestly; hiring plans limited. | | Inflation Pressure (higher = headwind) | | +0.00 |
Price pressures modest; some raw material increases; few plan to raise selling prices. | Loan demand stable or slightly higher; competition for borrowers; standards loosened in some. | Expectations for factory activity more optimistic. |
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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 | −1 | · | · | · | · | · | · | −1 | · | +1 | −1 | +1 | | Health CareXLV | +1 | · | · | · | · | +1 | · | −1 | · | · | · | −1 | | FinancialsXLF | · | +1 | +1 | · | +1 | · | +1 | · | · | · | · | +1 | | Consumer DiscretionaryXLY | +1 | +1 | +1 | · | +1 | · | · | · | +1 | −1 | · | +1 | | Communication ServicesXLC | · | · | · | · | · | · | · | · | · | · | · | +1 | | IndustrialsXLI | · | +1 | · | +1 | +1 | +1 | +1 | +1 | +1 | −1 | · | +1 | | Consumer StaplesXLP | · | · | · | · | +1 | · | · | · | · | · | · | −1 | | EnergyXLE | · | · | +1 | −1 | −1 | +1 | · | −1 | +1 | +1 | +1 | +1 | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +2 | +2 | +1 | +1 | +1 | | MaterialsXLB | · | · | · | · | · | · | · | +1 | −1 | · | · | +1 |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Real Estate +2 St. Louis, Minneapolis Residential activity increased at a strong pace; permits up almost 70 percent. Why it matters: Strongest Real Estate reads. | Real Estate +1 broad−based Broad-based Residential real estate strengthened in nearly all districts. Why it matters: Breadth lifts Real Estate. | Industrials +1 broad−based Broad-based Manufacturing improved in nearly all districts. Why it matters: Industrials positive. | Financials +1 New York Decrease in loan spreads; delinquencies down. Why it matters: New York holds 28% of Financials weight. | Consumer Discretionary +1 New York New vehicle sales running 20-30 percent ahead of a year earlier. Why it matters: NY weight lifts Discretionary. | Information Technology +1 San Francisco Expansion in user base for Internet and digital media products. Why it matters: SF carries 47% of IT weight. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Continues to expand slowly. |
| New York Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
| Philadelphia Growing +0.5 Outlook ▲ Maintained modest growth. |
| Cleveland Growing +0.5 Outlook ▲ Grew at a modest pace. |
| Richmond Growing +1.0 Outlook ▶ Grew moderately. |
| Atlanta Growing +0.5 Outlook ▲ Improved modestly. |
| Chicago Growing +0.5 Outlook ▶ Expanded at a slow pace. |
| St. Louis Growing +1.0 Outlook ▶ Expanded at a moderate pace. |
| Minneapolis Growing +1.0 Outlook ▶ Moderate growth. |
| Kansas City Growing +0.5 Outlook ▲ Showed modest improvement. |
| Dallas Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
| San Francisco Growing +0.5 Outlook ▶ Expanded at a modest pace. |
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Where the signal is thin or split Divergences to watch | Information Technology — San Francisco (+1, 47% weight) offsets declines elsewhere.
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| | Real Estate — Broad strength with two +2 reads.
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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 |