The Economy, While I Was Away...

By: The Greek

Did you miss me? Well, The Greek is back and raring to serve this economic data hungry lot.

(Article interests readers of: AMEX: DIA, AMEX: SPY, Nasdaq: QQQQ, NYSE: MER, Nasdaq: EBAY, NYSE: NOK, AMEX: VDE)

While I was away, the market celebrated better than expected monthly retail sales data, before souring on yet another poor ICSC-UBS weekly same-store sales survey (+0.3%). Hey, at least the weekly tally of chain stores showed growth, which is more than we could ask for in a period of general economic recession.

Inflation continues to rage with the PPI posting a big increase, driven by energy costs. The CPI also rose, but in line with expectations. Speaking of energy, petroleum storage saw yet another important draw, and we will have some interesting insight to share on that topic in the near-term, so keep a look out for the report at The Greek. Meanwhile industrial production and the Empire State Manufacturing Survey indicated a stabilization of manufacturing activity, however illusory that indication may be. Production capacity utilization also edged up a bit.

Today's Economic Data

With the most frightening of economic reports behind us, the market found some bargain hunters yesterday. Yet today, traders are spooked again after some more concerning company specific news from Merrill Lynch (NYSE: MER), eBay (Nasdaq: EBAY) and Nokia (NYSE: NOK), to name a few.

Weekly Initial Jobless Claims

Weekly claim benefit filers rose 17K to 372,000 this week, but more importantly, the long-term trend continues to rise. Despite moderating slightly, the four-week moving average still stood at 376K, a level significantly higher than a year ago. More importantly the direction is clearly pointing toward a growing strain on the labor market.

Leading Economic Indicators (March)

The Conference Board reported Leading Indicators for the month of March, posting a 0.1% increase, versus economist expectations for a 0.2% rise. Despite the shortfall, the index broke a streak of five consecutive monthly declines. The index clearly benefited from Fed rate cut efforts and we think on international demand for domestically manufactured goods, but the report continues to find negative contributions from housing, employment, consumer expectations and the stock market. The opinion of the Board itself, composed of economists well-attuned to this specific data and its historical usefulness, states, "the current behavior of the composite indexes suggests economic weakness is likely to continue in the near-term." Also noteworthy, the Board indicates the trouble has spread across economic factors.

Philadelphia Federal Reserve Survey

The Philly Fed Survey was reported (-24.9), below expectations and not in line with some positive news from other sources earlier this week. The Empire State reading stuck its nose above waterline a few days ago, and industrial production also offered good news yesterday when it was reported up 0.3% for March.

We have to wonder how domestic versus international end markets come to play within each region. We would assume the Port of New York is a more important international hub, and has thus attracted more multinationals into the New York region, but we're just speculating here. In any event, the two surveys have coincided for the most part ahead of this reported period, and New York's news was also not very good when considered in isolation.

Natural Gas Report

News from the EIA's weekly inventory report did not match yesterday's petroleum status data, as a build matched against oil's draw. The Greek is a big fan of natural gas, and rather than get into why and what plays we like this year and next, we'll instead use that inspiration for a coming piece. Thank you for your support, and enjoy a heavier schedule of informative commentary in the coming forever.

Please see our disclosure at the Wall Street Greek website.