EconomyxAI · Sector Watch November 2021Released December 1, 2021 |
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Conditions index +0.55 avg of 11 sectors, −2 to +2 |
| Outlook index +0.32 sectors with an outlook |
| Districts growing 12/12 per National Summary |
| Positive momentum 6/11 sectors improving |
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This release in brief The read | ■ | Released December 1, 2021, with information collected on or before November 19, 2021. | | ■ | Economic activity grew at a modest to moderate pace in most districts, constrained by supply disruptions and labor shortages. | | ■ | Leisure and hospitality picked up as Delta ebbed; manufacturing growth solid; nonresidential real estate rose widely. | | ■ | Loan demand increased in almost all districts; prices rose at a moderate to robust pace; robust wage growth. |
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Sector prospects Where the 3–12 month view points Strongest prospects Industrials
XLI
▶ Steady | +0.66 |
| Consumer Discretionary
XLY
▲ Improving | +0.64 |
| Real Estate
XLRE
▶ Steady | +0.61 |
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| Weakest prospects Consumer Staples
XLP
▼ Turning down | −0.06 |
| Health Care
XLV
▼ Turning down | −0.06 |
| Communication Services
XLC
▶ 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 | Industrials
XLI | | +0.66 | Favorable | +1.29 | +1.03 | ▶ −0.04 | | 2 | Consumer Discretionary
XLY | | +0.64 | Favorable | +1.14 | +0.50 | ▲ +0.96 | | 3 | Real Estate
XLRE | | +0.61 | Favorable | +1.03 | +0.50 | ▶ +0.43 | | 4 | Financials
XLF | | +0.53 | Favorable | +0.78 | +0.50 | ▲ +0.35 | | 5 | Information Technology
XLK | | +0.45 | Leaning Favorable | +0.49 | +0.50 | ▲ +0.38 | | 6 | Energy
XLE | | +0.42 | Leaning Favorable | +0.69 | +0.50 | ▶ −0.12 | | 7 | Materials
XLB | | +0.26 | Leaning Favorable | +0.49 | +0.00 | ▶ +0.17 | | 8 | Utilities
XLU | | +0.06 | Neutral | +0.13 | +0.00 | ▶ +0.07 | | 9 | Communication Services
XLC | | +0.02 | Neutral | +0.00 | +0.00 | ▶ +0.00 | | 10 | Health Care
XLV | | −0.06 | Neutral | −0.04 | +0.00 | ▼ −0.23 | | 11 | Consumer Staples
XLP | | −0.06 | Neutral | +0.00 | +0.00 | ▼ −0.22 |
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 |
Most districts grew modestly to moderately; growth held back by supply and labor constraints. | Employment growth ranged from modest to strong; robust wage growth nearly everywhere. | | Inflation Pressure (higher = headwind) | | +1.75 |
Prices rose at a moderate to robust pace; some easing in semiconductors and steel. | Loan demand increased in almost all districts. | Outlook positive in most districts, uncertainty over supply and labor easing. |
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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 | · | · | · | | FinancialsXLF | · | +1 | −1 | +1 | · | +1 | +1 | +1 | · | · | +2 | +1 | | Consumer DiscretionaryXLY | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +1 | +1 | · | +2 | | Communication ServicesXLC | · | · | · | · | · | · | · | · | · | · | · | · | | IndustrialsXLI | +1 | +1 | +1 | +1 | +1 | +2 | +1 | +1 | +1 | +2 | +2 | +1 | | Consumer StaplesXLP | · | · | · | · | · | · | · | · | · | · | · | · | | EnergyXLE | · | · | · | · | · | +1 | · | +1 | +1 | +1 | +1 | · | | UtilitiesXLU | · | · | · | · | · | +1 | · | · | · | · | · | · | | Real EstateXLRE | · | +1 | · | +1 | +1 | +1 | · | +1 | −1 | · | +1 | +2 | | MaterialsXLB | · | · | · | +1 | · | +1 | +1 | · | · | +1 | +1 | · |
| Contraction | −2 | −1 | 0 | +1 | +2 | Expansion |
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Top highlights What moved the scores Industrials +2 Atlanta, Kansas City, Dallas Record manufacturing sales; output elevated and broad based. Why it matters: Strongest Industrials reads. | Real Estate +2 San Francisco Residential market increased at a brisk pace. Why it matters: SF carries large Real Estate weight. | Consumer Discretionary +2 San Francisco Retail sales expanded markedly. Why it matters: Large Discretionary weight. | Financials +2 Dallas Loan volumes rose broadly. Why it matters: Strongest Financials read. | Consumer Discretionary +1 broad−based Broad-based Leisure and hospitality picked up as Delta ebbed. Why it matters: Broad Discretionary support. | Financials +1 broad−based Broad-based Loan demand increased in almost all districts. Why it matters: Financials positive. |
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Twelve Fed districts District roundup Boston Growing +0.5 Outlook ▲ Expanded at a modest pace, results mixed. |
| New York Growing +0.5 Outlook ▲ Grew at a modest pace. |
| Philadelphia Growing +1.0 Outlook ▲ Grew moderately, faster than before. |
| Cleveland Growing +1.0 Outlook ▲ Expansion picked up a bit. |
| Richmond Growing +0.5 Outlook ▲ Expanded at a modest rate. |
| Atlanta Growing +1.0 Outlook ▲ Grew at a moderate pace. |
| Chicago Growing +1.0 Outlook ▲ Increased moderately. |
| St. Louis Growing +0.5 Outlook ▲ Modest improvement. |
| Minneapolis Growing +1.0 Outlook ▲ Grew moderately. |
| Kansas City Growing +1.0 Outlook ▲ Expanded at a moderate pace. |
| Dallas Growing +1.5 Outlook ▲ Robust expansion continued. |
| San Francisco Growing +1.0 Outlook ▲ Strengthened moderately. |
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Where the signal is thin or split Divergences to watch | Real Estate — San Francisco +2 keeps the weighted score well above the unweighted average.
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| | Financials — Dallas +2 and broad loan demand increases lift the weighted score despite Philadelphia -1.
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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 |