EconomyxAI · Beige Book Sector Monitor February 2014Released March 5, 2014 |
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Conditions index +0.20 avg of 11 sectors, −2 to +2 |
| Outlook index +0.28 sectors with an outlook |
| Districts growing 9/12 per National Summary |
| Positive momentum 4/11 sectors improving |
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This release in brief The read | ■ | Released March 5, 2014, with information collected before February 24, 2014. | | ■ | Most districts expanded modestly to moderately; New York and Philadelphia declined slightly on severe weather, Chicago slowed and Kansas City was stable. | | ■ | Retail and auto sales softened as severe winter weather limited activity; manufacturing expanded at a moderate pace despite weather disruptions. | | ■ | Energy demand and production rose with the cold; residential markets mixed; price pressures subdued apart from energy and construction materials. |
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Sector prospects Where the 3–12 month view points Strongest prospects Information Technology
XLK
▶ Steady | +0.49 |
| | Real Estate
XLRE
▶ Steady | +0.35 |
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| Weakest prospects Materials
XLB
▼ Turning down | −0.14 |
| Consumer Discretionary
XLY
▼ Weakening | −0.11 |
| Consumer Staples
XLP
▶ 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 | Information Technology
XLK | | +0.49 | Leaning Favorable | +0.64 | +0.77 | ▶ +0.01 | | 2 | Energy
XLE | | +0.46 | Leaning Favorable | +0.88 | +0.50 | ▶ +0.01 | | 3 | Real Estate
XLRE | | +0.35 | Leaning Favorable | +0.65 | +0.50 | ▶ −0.16 | | 4 | Industrials
XLI | | +0.13 | Neutral | +0.31 | +0.59 | ▼ −0.62 | | 5 | Utilities
XLU | | +0.13 | Neutral | +0.31 | +0.00 | ▲ +0.19 | | 6 | Financials
XLF | | +0.03 | Neutral | −0.07 | +0.25 | ▶ −0.27 | | 7 | Communication Services
XLC | | +0.02 | Neutral | +0.05 | +0.00 | ▶ −0.02 | | 8 | Health Care
XLV | | +0.01 | Neutral | +0.00 | +0.00 | ▶ +0.01 | | 9 | Consumer Staples
XLP | | −0.02 | Neutral | +0.00 | +0.00 | ▶ −0.09 | | 10 | Consumer Discretionary
XLY | | −0.11 | Neutral | −0.25 | +0.50 | ▼ −0.95 | | 11 | Materials
XLB | | −0.14 | Neutral | −0.33 | +0.00 | ▼ −0.59 |
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 | | +0.25 |
Eight districts improved but modestly; NY and Philly declined on weather. | Employment improved gradually; skilled shortages. | | Inflation Pressure (higher = headwind) | | +0.00 |
Price pressures subdued apart from energy and construction products. | Loan demand mixed; mortgages decreased in several districts. | Outlook among most districts 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 | | Health CareXLV | · | · | · | · | · | · | · | · | · | · | · | · | | FinancialsXLF | +1 | −1 | · | · | · | · | · | −1 | · | · | · | +1 | | Consumer DiscretionaryXLY | · | −1 | −1 | · | · | · | −1 | · | +1 | −1 | · | · | | Communication ServicesXLC | · | · | · | · | +1 | · | · | · | · | · | · | · | | IndustrialsXLI | +1 | −1 | −1 | +1 | −1 | +1 | · | +1 | +1 | +1 | +1 | · | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | +1 | · | · | · | +1 | +1 | · | −1 | +1 | +1 | +1 | +1 | | UtilitiesXLU | +1 | · | · | +1 | · | · | · | · | · | · | · | +1 | | Real EstateXLRE | · | · | −1 | · | +1 | +1 | +1 | +1 | +1 | · | +1 | +1 | | MaterialsXLB | · | · | −1 | −1 | · | · | · | · | · | · | · | −1 |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Consumer Discretionary −1 New York, Philadelphia, Chicago, Kansas City Retail and auto sales weakened amid severe weather. Why it matters: Large-weight districts drag Discretionary. | Industrials −1 New York, Philadelphia, Richmond Manufacturing activity deteriorated with storms. Why it matters: Partial Industrials offset. | Industrials +1 Boston, Atlanta, Minneapolis, Dallas, Cleveland Manufacturing improved modestly. Why it matters: Industrials still positive on balance. | Information Technology +1 San Francisco, Boston Semiconductor sales at record levels; software stronger than expected. Why it matters: SF carries 47% of IT weight. | Energy +1 Dallas, Atlanta, Richmond Drilling and refining grew; natural gas robust. Why it matters: Energy positive with Dallas weight. | Real Estate +1 Richmond, Atlanta, Chicago, St. Louis, Dallas Home sales increased. Why it matters: RE positive tilt. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Modest increases in revenues. |
| New York Contracting −0.5 Outlook ▲ Declined modestly. |
| Philadelphia Contracting −0.5 Outlook ▲ Declined slightly. |
| Cleveland Growing +1.0 Outlook ▲ Continued at a moderate pace. |
| Richmond Growing +0.5 Outlook ▲ Increased modestly. |
| Atlanta Growing +0.5 Outlook ▲ Expanding slowly. |
| Chicago Growing +0.5 Outlook ▲ Growth slowed. |
| St. Louis Growing +1.0 Outlook ▲ Grow at a moderate pace. |
| Minneapolis Growing +1.0 Outlook ▲ Moderate growth. |
| Kansas City Flat Outlook ▲ Remained stable. |
| Dallas Growing +1.0 Outlook ▲ Grew at a moderate pace. |
| San Francisco Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
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Where the signal is thin or split Divergences to watch | Consumer Discretionary — New York (-1) carries heavy weight, pulling the weighted score below the unweighted average.
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| | Information Technology — San Francisco (+1, 47% weight) keeps IT positive.
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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 |