EconomyxAI · Sector Watch November 2005Released November 30, 2005 |
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Conditions index +0.45 avg of 11 sectors, −2 to +2 |
| Outlook index +0.18 sectors with an outlook |
| Districts growing 10/12 per National Summary |
| Positive momentum 5/11 sectors improving |
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This release in brief The read | ■ | Released November 30, 2005, with information collected before mid-November 2005 (date not printed in the PDF). | | ■ | Activity continued to expand from mid-October through mid-November, with manufacturing and services up in most districts and Gulf facilities coming back on line after the hurricanes. | | ■ | Retail sales rose in most districts but year-over-year gains were modest; auto sales declined in many districts as discounts ended and buyers shifted to fuel-efficient and foreign vehicles. | | ■ | Housing activity stayed high but cooled in many districts while commercial real estate strengthened; mortgage demand eased and overall lending was mixed. | | ■ | Hiring increased with slight labor-market tightening; input prices for energy, construction materials and transport kept rising, with modest pass-through to consumers. |
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Sector prospects Where the 3–12 month view points Strongest prospects | Materials
XLB
▲ Turning up | +0.45 |
| Information Technology
XLK
▶ Steady | +0.44 |
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| Weakest prospects Consumer Staples
XLP
▶ Steady | −0.04 |
| Utilities
XLU
▶ Steady | +0.01 |
| Communication Services
XLC
▶ Steady | +0.03 |
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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 | | +0.53 | Favorable | +1.00 | +0.50 | ▶ −0.23 | | 2 | Materials
XLB | | +0.45 | Leaning Favorable | +0.47 | +0.50 | ▲ +0.20 | | 3 | Information Technology
XLK | | +0.44 | Leaning Favorable | +0.70 | +0.50 | ▶ +0.06 | | 4 | Industrials
XLI | | +0.42 | Leaning Favorable | +0.95 | +0.50 | ▶ +0.07 | | 5 | Consumer Discretionary
XLY | | +0.17 | Leaning Favorable | +0.51 | +0.00 | ▲ +0.14 | | 6 | Health Care
XLV | | +0.15 | Neutral | +0.36 | +0.00 | ▶ +0.15 | | 7 | Financials
XLF | | +0.14 | Neutral | +0.57 | +0.00 | ▶ −0.26 | | 8 | Real Estate
XLRE | | +0.07 | Neutral | +0.41 | +0.00 | ▼ −0.37 | | 9 | Communication Services
XLC | | +0.03 | Neutral | +0.00 | +0.00 | ▶ +0.00 | | 10 | Utilities
XLU | | +0.01 | Neutral | +0.00 | +0.00 | ▶ +0.00 | | 11 | Consumer Staples
XLP | | −0.04 | Neutral | +0.00 | +0.00 | ▶ +0.00 |
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 | | +0.75 |
Expansion continued in all districts; manufacturing up everywhere except St. Louis (mixed); Gulf recovery under way. | Hiring increased in many districts with slight tightening and shortages in skilled and trucking occupations. | | Inflation Pressure (higher = headwind) | | −1.00 |
Persistent input price pressures in energy, construction materials and transport; fuel surcharges common; consumer prices up modestly. | Lending varied: slower in Richmond and Chicago, notably lower in New York, strong in Atlanta; mortgage demand eased. | Retailers cautiously optimistic about holidays; some worry energy prices will weigh on spending. |
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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 | +1 | · | · | · | +1 | · | · | · | · | · | · | +1 | | FinancialsXLF | · | +1 | · | +1 | · | +1 | · | · | · | · | · | +1 | | Consumer DiscretionaryXLY | · | · | · | · | · | +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 | +2 | · | | UtilitiesXLU | · | · | · | · | · | · | · | · | · | · | · | · | | Real EstateXLRE | · | · | · | · | · | · | · | +1 | · | · | +1 | +1 | | MaterialsXLB | · | · | · | +1 | · | · | +2 | · | +1 | · | +1 | · |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Energy +2 Dallas Capacity added aggressively; 200 rigs under construction. Why it matters: Largest Energy weight. | Materials +2 Chicago Steel industry "very strong"; inventories lean. Why it matters: Materials strength. | Industrials +1 broad−based Broad-based Manufacturing expanded in eleven districts. Why it matters: Broad Industrials strength. | Financials +1 New York Securities activity strengthened; bonuses up 12-15%. Why it matters: Largest Financials weight. | Consumer Discretionary +1 San Francisco, Dallas Retail sales solid and better than expected. Why it matters: Discretionary support. | Information Technology +1 San Francisco, Dallas Semiconductor orders and sales rose. Why it matters: IT positive. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Expanding; growth varies by sector. |
| New York Growing +0.5 Outlook ▲ Steady pace of expansion. |
| Philadelphia Flat Outlook ▶ Grew slowly. |
| Cleveland Growing +0.5 Outlook ▲ Gradual improvement. |
| Richmond Growing +1.0 Outlook ▲ Expanded at a solid pace. |
| Atlanta Growing +1.0 Outlook ▲ Pace improved. |
| Chicago Growing +0.5 Outlook ▲ Expanded at a moderate pace. |
| St. Louis Flat Outlook ▶ Mixed. |
| Minneapolis Growing +1.0 Outlook ▲ Solid growth. |
| Kansas City Growing +1.0 Outlook ▲ Expanded solidly. |
| Dallas Growing +1.0 Outlook ▲ Activity accelerated. |
| San Francisco Growing +1.0 Outlook ▲ Expanded at a solid pace. |
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Where the signal is thin or split Divergences to watch | Materials — Chicago's +2 pulls the weighted Materials score above the simple average.
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| | Energy — Dallas's +2 dominates; Atlanta's -1 has a small weight.
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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 |