EconomyxAI · Beige Book Sector Monitor May 2019Released June 5, 2019 |
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Conditions index +0.18 avg of 11 sectors, −2 to +2 |
| Outlook index +0.12 sectors with an outlook |
| Districts growing 11/12 per National Summary |
| Positive momentum 5/11 sectors improving |
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This release in brief The read | ■ | Released June 5, 2019, with information collected on or before May 24, 2019. | | ■ | Activity expanded at a modest pace overall, a slight improvement over the prior period; almost all districts grew and a few saw moderate gains. | | ■ | Manufacturing generally positive but with signs of slowing and more uncertainty; consumer spending positive but tempered; tourism stronger while vehicle sales were lower. | | ■ | Residential construction and real estate grew with wide variation; loan demand mixed but growing; agriculture weak; prices rose modestly with steel and lumber easing. |
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Sector prospects Where the 3–12 month view points Strongest prospects Real Estate
XLRE
▶ Steady | +0.56 |
| Consumer Discretionary
XLY
▲ Improving | +0.52 |
| Financials
XLF
▶ Steady | +0.43 |
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| Weakest prospects Energy
XLE
▼ Turning down | −0.33 |
| Information Technology
XLK
▼ Weakening | −0.25 |
| Utilities
XLU
▶ Steady | −0.01 |
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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 | Real Estate
XLRE | | +0.56 | Favorable | +0.86 | +0.50 | ▶ +0.47 | | 2 | Consumer Discretionary
XLY | | +0.52 | Favorable | +0.81 | +0.50 | ▲ +0.82 | | 3 | Financials
XLF | | +0.43 | Leaning Favorable | +0.71 | +0.50 | ▶ +0.51 | | 4 | Industrials
XLI | | +0.04 | Neutral | +0.38 | +0.03 | ▼ −0.20 | | 5 | Communication Services
XLC | | +0.02 | Neutral | +0.00 | +0.00 | ▶ +0.03 | | 6 | Materials
XLB | | +0.02 | Neutral | +0.11 | +0.00 | ▶ +0.09 | | 7 | Consumer Staples
XLP | | −0.00 | Neutral | +0.00 | +0.00 | ▶ +0.00 | | 8 | Health Care
XLV | | −0.01 | Neutral | +0.00 | +0.00 | ▶ −0.05 | | 9 | Utilities
XLU | | −0.01 | Neutral | +0.00 | +0.00 | ▶ −0.07 | | 10 | Information Technology
XLK | | −0.25 | Leaning Unfavorable | −0.42 | +0.00 | ▼ −0.69 | | 11 | Energy
XLE | | −0.33 | Leaning Unfavorable | −0.47 | −0.23 | ▼ −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 | | +0.50 |
Modest growth overall, slightly better than the prior period. | Modest-to-moderate job growth; tight labor; wage pressures subdued. | | Inflation Pressure (higher = headwind) | | +0.25 |
Prices up modestly; steel, metals and lumber easing. | Loan demand mixed but indicated growth. | Outlook solidly positive but modest; trade uncertainty rising in Dallas. |
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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 | | Health CareXLV | · | · | · | · | · | · | · | · | · | · | · | · | | FinancialsXLF | · | +1 | +1 | +1 | +1 | · | +1 | · | · | +1 | · | +1 | | Consumer DiscretionaryXLY | +1 | +1 | +1 | +1 | +1 | +1 | +1 | · | · | +1 | · | +1 | | Communication ServicesXLC | · | · | · | · | · | · | · | · | · | · | · | · | | IndustrialsXLI | −1 | +1 | +1 | −1 | −1 | +1 | · | −1 | +1 | +1 | +1 | +1 | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | · | · | · | · | · | +1 | · | +1 | · | −1 | −1 | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | +1 | +1 | · | +1 | +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 Information Technology −1 San Francisco Semiconductor and smartphone demand fell modestly. Why it matters: SF carries 47% of IT weight. | Energy −1 Dallas Drilling activity weakened; oilfield services slowed. Why it matters: Dallas carries the largest Energy weight. | Industrials −1 Boston, Cleveland, Richmond, St. Louis Manufacturing shipments and orders declined. Why it matters: Broad Industrials drag. | Industrials +1 New York, Philadelphia, Atlanta, Minneapolis, Kansas City, Dallas, San Francisco Manufacturing picked up. Why it matters: Offsets Industrials drag. | Consumer Discretionary +1 broad−based Broad-based Consumer spending and tourism up modestly. Why it matters: Discretionary positive in most districts. | Real Estate +1 San Francisco, New York, Dallas Housing markets firmed; home sales rose. Why it matters: Large RE weights. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Modest-to-moderate pace; manufacturers saw declines. |
| New York Growing +1.0 Outlook ▲ Picked up to a moderate pace. |
| Philadelphia Growing +0.5 Outlook ▲ Strengthened to a modest pace. |
| Cleveland Growing +0.5 Outlook ▲ Grew modestly. |
| Richmond Growing +0.5 Outlook ▲ Grew at a modest pace. |
| Atlanta Growing +0.5 Outlook ▲ Continued at a modest pace. |
| Chicago Growing +0.5 Outlook ▲ Increased slightly. |
| St. Louis Flat Outlook ▲ Unchanged. |
| Minneapolis Growing +0.5 Outlook ▲ Grew slightly. |
| Kansas City Growing +0.5 Outlook ▲ Continued to expand slightly. |
| Dallas Growing +1.0 Outlook ▶ Moderate expansion; signs of deceleration. |
| 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 | Information Technology — San Francisco -1 at 47% weight pulls weighted IT negative despite New York information-sector gains.
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| | Energy — Dallas -1 with the largest Energy weight drives the weighted score below the unweighted average.
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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 |