It's been an up-and-down week for the U.S. equity market, which registered a big gain on Monday only to give back the bulk of it on Tuesday and Wednesday. Investors are looking somewhat excited this morning, however, as they gear up for the extended Easter weekend. The S&P 500 futures are trading 10 points, or 0.4%, above fair value.
Investors received the Personal Income and Spending report for February this morning, and, for the second month in a row, it was in-line with expectations.
The report showed a modest uptick in the PCE Price Index, which increased 1.8% year-over-year after being up 1.7% year-over-year in January. The core PCE Price Index was up 1.6% year-over-year after three consecutive months of 1.5% year-over-year growth. Real PCE increased less than 0.1%, which should have a negligible impact on Q1 GDP calculations.
The key takeaway from the report is that it won't influence Fed officials to significantly alter the course of monetary policy.
- Personal Income increased 0.4% (Briefing.com consensus 0.4%), primarily due to a 0.6% increase in wages and salaries and a 0.6% increase in nonfarm proprietors' income
- Personal Spending rose 0.2% (Briefing.com consensus 0.2%)
- The PCE Price Index increased 0.2% (Briefing.com consensus 0.2%)
- The core PCE Price Index, which excludes food and energy, also increased 0.2% (Briefing.com consensus 0.2%)
- The personal savings rate increased to 3.4% from 3.2% in January
Investors also received the weekly Initial Claims report earlier this morning, which showed that initial claims decreased by 12,000 to 215,000 for the week ending March 24 (Briefing.com consensus 230,000). Continuing claims for the week ending March 17, meanwhile, increased by 35,000 to 1.871 million, edging up from the lowest level in nearly 45 years. The key takeaway from this report is that outside of some week-to-week volatility, initial and continuing claims remain at historically-low levels.
Today's last pieces of economic data -- the Chicago PMI for March (Briefing.com consensus 62.0) and the final reading of the University of Michigan Consumer Sentiment Index for March (Briefing.com consensus 102.0) -- will cross the wires at 9:45 AM ET and 10:00 AM ET, respectively.
Overseas, the major stock indices in Asia finished Thursday on a higher note, with Japan's Nikkei adding 0.6%, while the major bourses in Europe have also advanced, with Germany's DAX climbing 1.2%. European markets, like U.S. markets, will be closed tomorrow for Good Friday.
Outside of equities, U.S. Treasuries are a tick higher this morning, pushing the benchmark 10-yr yield one basis point lower to 2.77%. Meanwhile, the U.S. Dollar Index is down 0.1% at 89.69 after rallying nearly 1.0% on Wednesday, and WTI crude futures are flat at $64.38 per barrel, preserving their weekly loss of 2.3%.