EconomyxAI · Sector Watch January 2015Released January 14, 2015 |
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Conditions index +0.27 avg of 11 sectors, −2 to +2 |
| Outlook index +0.18 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 January 14, 2015, with information collected on or before January 5, 2015. | | ■ | Activity expanded at a modest or moderate pace in most districts; Kansas City grew only slightly and Dallas slowed with concern over lower oil prices. | | ■ | Consumer spending rose with modest retail gains and moderate to strong auto sales; travel picked up; manufacturing expanded in most districts. | | ■ | Commercial real estate expanded while single-family housing was flat; credit demand grew; energy services demand weakened as output rose; prices up slightly. |
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Sector prospects Where the 3–12 month view points Strongest prospects Consumer Discretionary
XLY
▶ Steady | +0.58 |
| Industrials
XLI
▶ Steady | +0.53 |
| Information Technology
XLK
▼ Turning down | +0.41 |
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| Weakest prospects Energy
XLE
▼ Weakening | −1.07 |
| Health Care
XLV
▶ Steady | +0.01 |
| 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 | Consumer Discretionary
XLY | | +0.58 | Favorable | +0.84 | +0.69 | ▶ +0.19 | | 2 | Industrials
XLI | | +0.53 | Favorable | +0.89 | +0.65 | ▶ +0.01 | | 3 | Information Technology
XLK | | +0.41 | Leaning Favorable | +0.58 | +0.77 | ▼ −0.34 | | 4 | Real Estate
XLRE | | +0.37 | Leaning Favorable | +0.66 | +0.43 | ▶ −0.07 | | 5 | Financials
XLF | | +0.21 | Leaning Favorable | +0.46 | +0.50 | ▶ −0.29 | | 6 | Utilities
XLU | | +0.08 | Neutral | +0.21 | +0.00 | ▶ +0.06 | | 7 | Communication Services
XLC | | +0.04 | Neutral | +0.05 | +0.00 | ▶ +0.00 | | 8 | Materials
XLB | | +0.02 | Neutral | +0.17 | +0.00 | ▶ +0.03 | | 9 | Consumer Staples
XLP | | +0.02 | Neutral | +0.00 | +0.00 | ▶ +0.10 | | 10 | Health Care
XLV | | +0.01 | Neutral | +0.14 | +0.00 | ▶ −0.14 | | 11 | Energy
XLE | | −1.07 | Unfavorable | −1.08 | −1.09 | ▼ −1.44 |
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 |
Modest or moderate growth in most districts; Kansas City slight; Dallas slowed. | Payrolls in a variety of sectors expanded moderately. | | Inflation Pressure (higher = headwind) | | +0.00 |
Prices increased slightly; petroleum-based products declined. | Demand for business and consumer credit grew; credit quality improved. | Contacts in several districts expect somewhat faster growth. |
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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 | +1 | · | · | +1 | · | · | · | · | · | · | · | · | | FinancialsXLF | · | +1 | +1 | +1 | +1 | · | · | +1 | · | · | · | · | | Consumer DiscretionaryXLY | +1 | −1 | +1 | +1 | +1 | +2 | +2 | · | · | −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 | −2 | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | +1 | | Real EstateXLRE | · | +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 Energy −2 Dallas Oilfield services demand decreased; outlooks expect 15 to 40 percent decline. Why it matters: Dallas carries the largest Energy weight. | Energy −1 Kansas City, Minneapolis, Atlanta Oil drilling declined; supply outpacing demand. Why it matters: Broadens Energy weakness. | Consumer Discretionary +2 Atlanta, Chicago Lower gas prices boosted larger vehicles; holiday sales exceeded expectations. Why it matters: Strong Discretionary reads. | Consumer Discretionary −1 New York Holiday sales sluggish and below plan. Why it matters: NY weight trims Discretionary. | Consumer Discretionary −1 Kansas City Retail, auto and tourism sales declined. Why it matters: Small Discretionary offset. | Industrials +1 broad−based Broad-based Manufacturing expanded in most districts. Why it matters: Industrials positive. |
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Twelve Fed districts District roundup Boston Growing +1.0 Outlook ▲ Sales ahead of year-earlier levels. |
| New York Growing +1.0 Outlook ▲ Continued at a moderate pace. |
| Philadelphia Growing +0.5 Outlook ▲ Grow at a modest pace. |
| Cleveland Growing +0.5 Outlook ▲ Expanded at a modest pace. |
| Richmond Growing +0.5 Outlook ▲ Expanded modestly. |
| Atlanta Growing +1.0 Outlook ▲ Continued to improve. |
| Chicago Growing +1.0 Outlook ▲ Growth remained moderate. |
| St. Louis Growing +1.0 Outlook ▲ Slightly faster pace. |
| Minneapolis Growing +0.5 Outlook ▲ Grew at a modest pace. |
| Kansas City Growing +0.2 Outlook ▲ Grow slightly. |
| Dallas Growing +0.5 Outlook ▼ Slightly slower pace. |
| San Francisco Growing +1.0 Outlook ▲ Improve moderately. |
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Where the signal is thin or split Divergences to watch | Energy — Dallas (-2) carries the largest Energy weight, driving the weighted score sharply negative.
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| | Consumer Discretionary — New York (-1) offsets strong Atlanta and Chicago 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 |