Of Note This Week
Here’s a look at vaccine innovation since 1880. As you can see, prior to the COVID-19 vaccine(s), which took less than 1 year to develop and get licensed in the US, the next fastest vaccine was Measles, which took 10 years!
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Total Housing Starts posted a +5.8% M/M gain in December. They were driven by Single-Family Starts which posted a robust +12.0% M/M gain, their biggest monthly increase since June. Multi-family Starts fell -15.2% M/M but have only accounted for roughly one-quarter of Total Starts since 1959.
On an absolute basis, Total Starts rose to 1.669 million units SAAR, the best reading since Sept. 2006! The December reading handily beat expectations which were forecasting 1.560 million units. Single-Family Starts continued their strong upward trend, rising to 1.338 million units, the best reading since Sept. 2006! Multi-Family Starts slowed to 312,000 units.
On a Y/Y basis, Total Starts slowed to +5.2% from +15.1% in November. Single Family Starts slowed slightly to +27.8% from +28.1% while Multi-Family Starts dropped -40.0%, their biggest decline since September 2016.
Existing Home Sales
Existing home sales ticked higher in December, rising to a seasonally adjusted annual rate of 6.76 million units. They’re up +22.2% Y/Y. The chief economist for the Realtors said: “Home sales could possibly reach 8 million if we had more inventory.” That would be a record.
Speaking of inventory, the monthly supply of existing homes fell to a record low of 1.9 months, meaning if now new inventory were to come onto the market, the current inventory would be gone in 1.9 months!
The strong demand has pushed prices ever higher. They have come in slightly the past couple of months, but are still up +12.9% from a year ago. The median existing home price was $309,800 in December, only -1.1% below October 2020’s record of $313,100.
January Flash PMIs
January Flash Manufacturing PMIs were mixed with the U.S. moving higher while the UK dropped because of the lockdowns. The U.S. jumped to 59.1 from 57.1, an all-time high! Germany moved down to 57.0 from 58.3. France rose to 51.5 from 51.1, a 6-month high. The UK dropped to 52.9 from 57.5, a 7-month low. The Eurozone declined to 54.7 from 55.2 and Japan moved down to 49.7 from 50.0, back into contraction.
On the Services side, the U.S. moved higher to 57.5 from 54.5. Germany moved down to 46.8 from 47.0. France declined to 46.5 from 49.1. The UK fell to 38.8 from 49.4, an 8-month low. The Eurozone moved down to 45.0 from 46.4. Japan declined to 45.7 from 47.7, a 5-month low.
The Composite PMIs were also mixed. The U.S. increased to 58.0 from 55.3. Germany declined to 50.8 from 52.0, a 7-month low. France moved down to 47.0 from 49.5. The UK plummeted to 40.6 from 50.4, an 8-month low. The Eurozone moved down to 47.5 from 49.1. Japan declined to 46.7 from 48.5.
S&P 500 Earnings Estimates
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