It’s a holiday-shortened week, so volumes overall should be lower this week. Overall last week, the economic news was positive. While the Kansas City Fed Manufacturing Index declined, both the New York and Philly indices beat expectations and improved significantly month-over-month. Capacity Utilization and Industrial Production both improved more than expected. While Weekly Jobless Claims increased slightly for the 2nd consecutive week, Continued Claims dropped by another 129,000. Retail Sales, a good barometer for how we might end the year in terms of economic growth, surpassed expectations for October and more than doubled September’s activity.
Holiday Sales are expected to increase between 8.5% and 10.5% year-over-year, which should propel markets through year-end. This week we'll get data on Consumer Spending, Personal Income, and Consumer Sentiment. This will give us a little clearer picture on the state of the consumer as we kick off holiday sales with Black Friday this week. This year's Thanksgiving meal has been touted as one of the more expensive meals in decades due to the rise in inflation affecting core commodities that will likely be consumed at the annual meal this year. Some positive news on the inflation front—President Biden opened 80 million acres of offshore oi & gas leases in the Gulf of Mexico late last week. This could provide 1.1 billion barrels of oil and 4.4 trillion cubic feet of natural gas. This action could help alleviate the recent increase in gas prices, after multiple failed attempts by the administration to convince OPEC to produce more oil. Expect calmer markets this week on lighter trading volume as we approach the Thanks giving holiday.