ISM Service….

Gryymt stark siffra, såklart! Fattas bara!

59,4 mot 57,0 väntat och föreg. 57,1. Sysselsättningskomponenten är starkt… samt priserna fortsätter att stiga!

Så här skriver David Rosenberg från gluskin Sheff om den starka statistiken!!!

1. To put the 60.8 January reading into historical perspective, this level is relatively high and we found that on an upswing, we only see readings close to this level around 2% of the time. Moreover, the percent of the time this level represented a high was 20%. On average, the index peaked five months later and five points higher — so we could see the ISM go higher over the next few months.

2. Economic growth tends to slow after a post-60 reading. Real GDP averaged 6% four-quarters before the peak and about 3.5% after. Industrial production averaged 10% before and about 5% a year after.

3. What about equities post-ISM peaks? We found that the S&P 500 rallied 15% in the year leading up to the peak, and 4% one year after.

4. One standout detail in the January report was the ISM prices paid component, which rose to 81.5. We could still go higher from here though, as the current level represents a peak 25% of the time.

5. We found that around prices paid peaks, total inflation averaged 3.4% a year before, 4% at the peak and 6% after. Core inflation (excluding food and energy) averaged 3% before, 2% at the peak and 3% after (so no real effect on core inflation). The 10-year note yield tended to average about 50bps higher post peak than pre-peak.

6. Profits tend to slow around both ISM peaks and prices paid peaks. Using economy-wide profits from the National Accounts, profit growth ran at 15% pre-ISM prices paid peak versus 5% after.

7. Margins are set to compress and compress sharply and likely weigh against consensus views of +15% earnings growth this year. See Steel-Price Rises Pressure Supply Chain on page B1 of the WS. Unit labour costs are falling, albeit at a far slower rate than a year ago (-0.2% YoY versus -3.5% this time last year). And look for non-unit labour costs, like higher inventory financing expenses, to bite into profit margins as well — see Fearing Inflation, Firms Stocking Up on page C1 of the WSJ.

Eller put it simple…

1, Kommande 12 månader kommer kännetecknas av hygglig tillväxt, fast LÄGRE än de senaste 12 månaderna.
2, Kommande 12 månader kommer kännetecknas av stigande inflations tendenser. Högre än de vi har sett under de senaste 12 månaderna.

Klättrar SPX upp till gamla 2007 toppen någon gång under året ska vi vara mycket nöjda!

Trevlig kväll!