EconomyxAI · Beige Book Sector Monitor January 2003Released January 15, 2003 |
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Conditions index −0.06 avg of 11 sectors, −2 to +2 |
| Outlook index −0.01 sectors with an outlook |
| Districts growing 1/12 per National Summary |
| Positive momentum 7/11 sectors improving |
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This release in brief The read | ■ | Released January 15, 2003, with information collected before January 7, 2003. | | ■ | Growth was subdued from mid-November to early January with little change; most districts called activity 'sluggish' or 'soft' and Dallas was weakest ('remained anemic'). | | ■ | New York, Philadelphia and Cleveland were more favorable than other districts, with New York describing various signs of improvement. | | ■ | Holiday sales were disappointing and at or below last year with heavy discounting, though autos surged at year-end on incentives; manufacturing improved slightly, led by defense and biomedical products. | | ■ | Housing stayed high but cooled a bit; commercial real estate slack persisted in all districts; energy drilling barely responded to sharp price increases. |
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Sector prospects Where the 3–12 month view points Strongest prospects Information Technology
XLK
▲ Turning up | +0.30 |
| Health Care
XLV
▶ Steady | +0.14 |
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| Weakest prospects Consumer Discretionary
XLY
▶ Steady | −0.36 |
| Communication Services
XLC
▼ Turning down | −0.20 |
| Materials
XLB
▶ Steady | −0.08 |
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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 | | +0.30 | Leaning Favorable | +0.51 | +0.00 | ▲ +0.88 | | 2 | Health Care
XLV | | +0.14 | Neutral | +0.31 | +0.00 | ▶ +0.07 | | 3 | Energy
XLE | | +0.09 | Neutral | +0.00 | +0.00 | ▶ +0.23 | | 4 | Financials
XLF | | +0.07 | Neutral | +0.21 | +0.05 | ▲ +0.29 | | 5 | Utilities
XLU | | +0.00 | Neutral | +0.00 | +0.00 | ▶ +0.03 | | 6 | Consumer Staples
XLP | | −0.02 | Neutral | +0.00 | +0.00 | ▶ −0.07 | | 7 | Real Estate
XLRE | | −0.05 | Neutral | −0.05 | −0.12 | ▲ +0.32 | | 8 | Industrials
XLI | | −0.05 | Neutral | −0.28 | +0.07 | ▶ +0.26 | | 9 | Materials
XLB | | −0.08 | Neutral | −0.25 | +0.00 | ▶ −0.07 | | 10 | Communication Services
XLC | | −0.20 | Leaning Unfavorable | −0.40 | +0.00 | ▼ −0.38 | | 11 | Consumer Discretionary
XLY | | −0.36 | Leaning Unfavorable | −0.73 | −0.16 | ▶ −0.02 |
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 | | +0.00 |
Subdued growth with little change from the last survey; most districts 'sluggish' or 'soft', Dallas 'anemic'. | Firms very cautious in hiring, labor in ample supply, continued layoffs in St. Louis and San Francisco; only Minneapolis tightened. | | Inflation Pressure (higher = headwind) | | +0.00 |
Rising energy, steel and packaging input costs, but fierce competition kept final goods prices from rising. | Loan demand up on net on consumer and real estate strength; business loans depressed in five districts; Kansas City tightened standards. | New York manufacturers 'overwhelmingly optimistic', but Philadelphia firms planning capex increases fell and SF excess capacity to persist six months or more. |
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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 | | Health CareXLV | · | · | · | · | · | +1 | · | · | · | · | · | +1 | | FinancialsXLF | +1 | · | +1 | · | · | +1 | · | +1 | · | −1 | · | · | | Consumer DiscretionaryXLY | −1 | −1 | · | −1 | · | · | −1 | −1 | −1 | · | −1 | −1 | | Communication ServicesXLC | · | · | · | · | · | · | · | · | · | · | · | −1 | | IndustrialsXLI | −1 | +1 | · | · | · | −1 | · | −1 | +1 | −1 | −1 | · | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | · | · | · | · | · | · | · | · | · | · | · | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | · | · | · | · | +1 | · | · | · | · | · | −1 | · | | MaterialsXLB | · | · | · | −1 | · | −1 | · | · | +1 | · | −1 | · |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Consumer Discretionary −1 broad−based Broad-based Holiday sales disappointing, below plan, heavy discounting. Why it matters: Nine districts negative. | Industrials +1 New York Manufacturing steady to improved; port shipments extremely strong. Why it matters: Large Industrials weight. | Industrials −1 St. Louis, Kansas City, Dallas, Boston Plant closings and layoffs; manufacturing weakened. Why it matters: Broad Industrials drag. | Financials +1 Boston, Philadelphia, Atlanta, St. Louis Insurers strong; loans moving up. Why it matters: Financials tilt positive. | Real Estate +1 Richmond Home sales 'tremendously active'. Why it matters: Real Estate lift. | Real Estate −1 Dallas Construction activity at low levels; office market weak. Why it matters: Large Texas weight. |
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Twelve Fed districts District roundup Boston Contracting −0.5 Outlook ▲ Remains soft. |
| New York Growing +0.5 Outlook ▲ Mixed, with a pickup in manufacturing. |
| Philadelphia Flat Outlook ▶ Mixed. |
| Cleveland Flat Outlook ▲ Mixed signals. |
| Richmond Flat Outlook ▲ Remained sluggish. |
| Atlanta Contracting −0.5 Outlook ▶ Remained subdued. |
| Chicago Contracting −0.5 Outlook ▶ Remained soft. |
| St. Louis Contracting −1.0 Outlook ▼ Softened. |
| Minneapolis Flat Outlook ▶ Subdued. |
| Kansas City Contracting −0.5 Outlook ▶ Very sluggish. |
| Dallas Contracting −1.0 Outlook ▼ Remained anemic. |
| San Francisco Flat Outlook ▶ Sluggish growth. |
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Where the signal is thin or split Divergences to watch | Industrials — New York's +1 carries a large weight, so the weighted score sits above the many -1 district reads.
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| | Consumer Discretionary — nine of twelve districts negative; weighting changes little.
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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 |