Economic Update 07/20/15

CONSUMER & WHOLESALE PRICES INCREASE

The Labor Department announced a 0.3% June rise in the headline Consumer Price Index, following the 0.4% advance for May. This left annualized consumer inflation positive for the first time in six months (+0.1%). June brought a 0.2% gain for the core CPI, which is now up 1.8% across the past year. Last month also saw the Producer Price Index ascend 0.4%; in May, it climbed 0.5%.

HOUSEHOLD SENTIMENT, RETAIL SALES COOL

Retail sales fell 0.3% last month after a 1.0% rise in May, according to the Commerce Department. Analysts polled by MarketWatch felt sales would pick up 0.2% in June. The University of Michigan’s initial July consumer sentiment index slipped 2.8 points to a 93.3 reading.

LAST MONTH SAW A JUMP IN CONSTRUCTION

Census Bureau data showed housing starts up 9.8% in June. Building permits rose 7.4% to an 8-year peak; permits for single-family homes hit a 7½-year high.

GREEK DEBT DEAL, EARNINGS TAKE STOCKS NORTH

Upside surprises and the approval of a third Greek bailout by European leaders led to impressive weekly gains for the major indices. The S&P 500 rose 2.41% to 2,126.64, the Dow 1.84% to 18,086.45 and the Nasdaq 4.25% to 5,210.14.

THIS WEEK: Monday’s earnings reports: Halliburton, Hasbro, HealthStream, Morgan Stanley and Unisys. Tuesday’s earnings: Apple, Microsoft, Hanesbrands, BoNY Mellon, Chipotle, Yahoo!, GoPro, Harley-Davidson, Kaiser Aluminum, Lexmark, Lockheed Martin, Fifth Third, Manpower, Skechers, and Travelers Companies. Wednesday offers June existing home sales and earnings from Abbott Labs, Altera, American Express, Ameriprise Financial, AutoNation, Boeing, SanDisk, Cheesecake Factory, Coca-Cola, Discover, Dolby Labs, Equifax, Northern Trust, Owens Corning, Qualcomm, Royal Caribbean, Six Flags, Smart & Final, Texas Instruments, Whirlpool, Tupperware, and United Rentals. Thursday offers the Conference Board LEI, a new initial claims report and earnings from 3M, Ace Hardware, Alaska Airlines, Amazon, AT&T, BJ’s, Boise Cascade, Capital One, Caterpillar, Celgene, Chubb, Bristol-Myers Squibb, Comcast, CoreLogic, Dow Chemical, Dr. Pepper Snapple, Eli Lilly, E*TRADE, Dunkin’ Brands, GM, Invacare, Kimberly-Clark, Macerich, McDonald’s, Pandora, PulteGroup, Quest Diagnostics, Raytheon, Southwest Airlines, Starbucks, T. Rowe Price, TripAdvisor, Under Armour, Union Pacific, VISA, and Waste Management. Friday brings June new home sales plus earnings from American Airlines, Biogen, Spirit Airlines, and Xerox.