EconomyxAI · Beige Book Sector Monitor June 2002Released June 12, 2002 |
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Conditions index +0.27 avg of 11 sectors, −2 to +2 |
| Outlook index +0.16 sectors with an outlook |
| Districts growing 8/12 per National Summary |
| Positive momentum 7/11 sectors improving |
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This release in brief The read | ■ | Released June 12, 2002, with information collected before June 3. | | ■ | Activity expanded at a moderate pace, with modest but uneven growth: some sectors improving while others softened or stayed weak. | | ■ | Retail sales were flat in most districts and autos mixed, but manufacturing output, shipments and orders rose in most districts. | | ■ | Residential real estate stayed robust while commercial markets remained weak; energy activity turned up sharply in Kansas City and Dallas. | | ■ | Labor markets improved marginally but stayed slack; steel prices were sharply higher and energy and insurance costs kept rising. |
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Sector prospects Where the 3–12 month view points Strongest prospects Energy
XLE
▲ Improving | +1.05 |
| Materials
XLB
▲ Improving | +0.71 |
| Industrials
XLI
▶ Steady | +0.19 |
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| Weakest prospects Communication Services
XLC
▼ Weakening | −0.48 |
| Real Estate
XLRE
▶ Steady | −0.12 |
| Utilities
XLU
▶ Steady | −0.00 |
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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 | | +1.05 | Favorable | +1.10 | +0.50 | ▲ +1.73 | | 2 | Materials
XLB | | +0.71 | Favorable | +0.84 | n/a | ▲ +0.67 | | 3 | Industrials
XLI | | +0.19 | Leaning Favorable | +0.39 | +0.22 | ▶ +0.29 | | 4 | Financials
XLF | | +0.19 | Leaning Favorable | +0.15 | +0.00 | ▼ +0.12 | | 5 | Information Technology
XLK | | +0.13 | Neutral | +0.50 | +0.17 | ▶ −0.07 | | 6 | Consumer Discretionary
XLY | | +0.11 | Neutral | +0.22 | +0.26 | ▶ +0.02 | | 7 | Health Care
XLV | | +0.05 | Neutral | +0.15 | n/a | ▶ −0.04 | | 8 | Consumer Staples
XLP | | +0.01 | Neutral | +0.00 | n/a | ▶ +0.06 | | 9 | Utilities
XLU | | −0.00 | Neutral | +0.00 | n/a | ▶ +0.00 | | 10 | Real Estate
XLRE | | −0.12 | Neutral | −0.04 | −0.17 | ▶ +0.12 | | 11 | Communication Services
XLC | | −0.48 | Leaning Unfavorable | −0.38 | n/a | ▼ −0.60 |
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 |
Overall activity expanded at a moderate pace, with modest but uneven growth across sectors and regions. | Labor market conditions improved marginally but remained slack; temp demand rose in several districts. | | Inflation Pressure (higher = headwind) | | +0.25 |
Price pressures in check overall, but steel prices sharply higher in most districts and energy and insurance costs rising. | Few changes in lending; consumer side stronger than commercial; San Francisco banks report improving earnings and loan quality. | Manufacturers in New York and Philadelphia expect further gains and summer tourism bookings are strong, but Dallas contacts are disappointed and retailers there less 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 | · | · | · | | FinancialsXLF | · | · | +1 | · | · | · | · | −1 | · | −1 | · | +1 | | Consumer DiscretionaryXLY | +1 | · | +1 | · | · | · | · | · | · | · | −1 | +1 | | Communication ServicesXLC | · | · | · | · | · | · | · | +1 | · | · | · | −1 | | IndustrialsXLI | · | +1 | +1 | +1 | +1 | · | +1 | +1 | +1 | +1 | · | −1 | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | · | · | · | · | · | · | · | · | · | +2 | +2 | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | −1 | +1 | · | −1 | +1 | · | · | · | · | −1 | −1 | · | | MaterialsXLB | · | · | +1 | +1 | +1 | +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 activity increased sharply; U.S. rig count picked up steadily for seven weeks on higher prices. Why it matters: Dallas holds the dominant Energy weight; a +2 swings Energy from bottom to top. | Energy +2 Kansas City Rig count rose by nearly a quarter in May from a two-and-a-half-year low. Why it matters: Second-largest Energy district confirms the rebound. | Materials +1 broad−based Nine districts Most districts reported steel prices sharply higher; domestic steel up as much as 30 percent. Why it matters: Breadth across heavy-weight districts keeps Materials near the top. | Industrials +1 broad−based Nine districts Factory production, shipments and orders higher in most districts; heavy truck orders surging ahead of EPA rules. Why it matters: Broad gains across the Midwest and Northeast lift Industrials. | Industrials −1 San Francisco Recession-like conditions in commercial aircraft manufacturing continued. Why it matters: A large Industrials district negative trims the weighted gain. | Information Technology +1 San Francisco, Boston, Chicago Semiconductor orders and sales picked up; telecom equipment industry 'in recovery mode.' Why it matters: Positive readings in the top IT districts offset Richmond and Minneapolis declines. |
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Twelve Fed districts District roundup Boston Growing +1.0 Outlook ▲ Economic conditions are improving. |
| New York Growing +1.0 Outlook ▲ Further signs of perking up despite softer consumer spending. |
| Philadelphia Growing +1.0 Outlook ▲ Business activity rose in May. |
| Cleveland Flat Outlook ▶ Conditions much the same as in the last report. |
| Richmond Growing +1.0 Activity increased modestly but unevenly. |
| Atlanta Flat Outlook ▶ Economic activity was sluggish in late May. |
| Chicago Growing +1.0 Modest expansion in April and May. |
| St. Louis Growing +1.0 Outlook ▲ Activity continuing to pick up, although slowly. |
| Minneapolis Flat Outlook ▲ Overall economic activity is mixed. |
| Kansas City Growing +1.0 Outlook ▲ Continued signs of improvement in May. |
| Dallas Flat Outlook ▼ Signs of slow improvement, but growth disappointing. |
| San Francisco Growing +1.0 Outlook ▲ Activity expanded at a moderate pace. |
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Where the signal is thin or split Divergences to watch | Energy — Only Dallas and Kansas City reported, both +2; as they hold most of the Energy weight, the weighted score jumps far above the simple average.
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| | Materials — Broad +1 readings driven by the steel tariff price surge; weighted and unweighted scores both high.
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| | Communication Services — Thin coverage; San Francisco price wars (-1) offset St. Louis advertising strength (+1).
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| | District validation: Atlanta rated 0 overall on 'sluggish' activity with mostly neutral sector scores.
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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 |