GDP Report With New Seasonal Adjustments
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July 30, 2015

7-30-2015 6-00-03 PM

GDP data was reported today. I trust Consumer Metrics Institute to analyze the full report.

Summary and Commentary

Our observations this month are focused on the BEA's revisions to the historic data:

-- The revisions follow a recent annual pattern of the BEA revising historic quarterly growth rates lower. This revision removed -0.22% on average from previously reported growth rates, while the 2014 revisions removed -0.19% on average from the then previously published growth rates (and another -0.09% was removed on average in 2013). The cumulative impact of the successive hair-cuts has reduced historic growth rates by an average approaching one half percent relative to "final" headline numbers -- representing an optimistic bias of about a half percent in the BEA's "final" estimates. It is worth noting that this optimistic bias has been getting progressively worse.

-- Especially hard hit in the revisions were the real per-capita disposable income numbers. The cumulative compound annualized growth rate for real disposable income has been only +0.45% since the second quarter of 2008. And these figures represent mean incomes that are skewed by disproportionate growth at the upper end. According to Sentier Research, median incomes during the same time span have contracted by roughly 4%.

-- And household savings rates have been weaker than previously suspected, confirming the lower incomes.

A conclusion from the above? The BEA has been persistently optimistic about the "Great Recovery" while the median household has been hammered. Sadly, nothing in this report suggests that things are getting better.

 

It’s controversial to add new revisions to important data but it’s happily done to inflation and employment data routinely. Now we see a better GDP report which Consumer Metrics Institute can thankfully tear apart and report.

Stocks opened lower Thursday but the trusty dip buying crowd was there to boost indexes off their lows to close mostly unchanged. Beneath the surface, and globally, selling dominated overall once again. Commodities fell once again as the dollar rallied modestly. Bonds were well-bid.

Leading market sectors higher included: Tech (QQQ), Retail (XRT), Homebuilders (ITB), Utilities (XLU), UK (EWU), Taiwan (EWT), Vietnam (VNM), India (EPI) and Bonds (TLT).

Leading market sectors lower included: Energy (XLE), Oil & Gas Exploration (XOP), REITs (IYR), Emerging Markets (EEM), European Monetary Union (EZU), Germany (EWG), Spain (EWP), South Korea (EWY), Brazil (EWZ), Russia (RSX), China (FXI), Shanghai (ASHR), Gold (GLD), Gold Stocks (GDX), Silver (SLV), Crude Oil (USO), Natural Gas (UNG), Commodity Tracker (DBC) and Base Metals (DBB).

The top 20 market movers by percentage change in volume whether rising or falling is available daily.

Volume was light and breadth per the WSJ was mixed.

7-30-2015 6-06-55 PM Diary

 

Charts of the Day
  • SPY 5 MINUTE

    SPY  5  MINUTE

  • SPY DAILY

    SPY DAILY

  • SPX WEEKLY

    SPX WEEKLY

  • INDU DAILY

    INDU DAILY

  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • NDX WEEKLY

    NDX WEEKLY

  • XLB WEEKLY

    XLB WEEKLY

  • XLE WEEKLY

    XLE WEEKLY

  • XLF WEEKLY

    XLF WEEKLY

  • XLI WEEKLY

    XLI WEEKLY

  • XLP WEEKLY

    XLP WEEKLY

  • XLY WEEKLY

    XLY WEEKLY

  • XRT WEEKLY

    XRT WEEKLY

  • XLV WEEKLY

    XLV WEEKLY

  • IBB WEEKLY

    IBB WEEKLY

  • ITB WEEKLY

    ITB WEEKLY

  • IYR WEEKLY

    IYR WEEKLY

  • IYT WEEKLY

    IYT  WEEKLY

  • XLU WEEKLY

    XLU WEEKLY

  • TAN WEEKLY

    TAN WEEKLY

  • TLT WEEKLY

    TLT WEEKLY

  • UUP WEEKLY

    UUP WEEKLY

  • FXE WEEKLY

    FXE WEEKLY

  • FXY WEEKLY

    FXY WEEKLY

  • GLD WEEKLY

    GLD WEEKLY

  • GDX WEEKLY

    GDX WEEKLY

  • SLV WEEKLY

    SLV WEEKLY

  • USO WEEKLY

    USO WEEKLY

  • DBC WEEKLY

    DBC WEEKLY

  • EFA WEEKLY

    EFA WEEKLY

  • IEV WEEKLY

    IEV WEEKLY

  • EEM WEEKLY

    EEM WEEKLY

  • EWG WEEKLY

    EWG WEEKLY

  • EWU WEEKLY

    EWU WEEKLY

  • EWP WEEKLY

    EWP WEEKLY

  • EWL WEEKLY

    EWL WEEKLY

  • EWJ WEEKLY

    EWJ WEEKLY

  • EWY WEEKLY

    EWY WEEKLY

  • EWZ WEEKLY

    EWZ WEEKLY

  • RSX WEEKLY

    RSX WEEKLY

  • EPI WEEKLY

    EPI WEEKLY

  • FXI WEEKLY

    FXI WEEKLY

  • NYMO DAILY

    NYMO  DAILY

    The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

  • NYSI DAILY

    NYSI DAILY

    The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.


     

  • VIX WEEKLY

    VIX WEEKLY

    The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.


Thursday’s comeback rally was transparent to me anyway. The opening decline was quickly bought and we’re heading to the close of July as buyers are desirous of saving the month. The have a slight win thus far but shares overall remain in the long 2015 trading range.

Let’s see what happens.

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Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001. ETF Digest was named one of the most informative ETF websites in the 10th Annual Global ETF Awards.



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Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com

 

ETF Digest

Market Summary
NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index 10 Year Treasury Note Yield Gold Bugs Index Morgan Stanley High Tech 35 Index Market Chart
Commodity Quote Change Change % NY
Gold1,093.704.400.40 % 09:10
WTI Crude Futr47.87-0.65-1.34 %08:37
Index Quotes Change Change % Local
CRB204.32-0.40-0.19 %08:48
US Dollar96.69-0.93-0.95 %09:03
Index Quotes Change Change % Local
VIX12.13-0.37-2.96 %07/30
MSCI Value Daily MTD YTD
Brazil1428.540-1.78 %-13.03 %-22.04 %
Russia472.2500.24 %-7.91 %16.63 %
India501.9160.24 %0.23 % 1.11 %
China65.984-0.58 %-11.29 %-0.08 %