Thursday's Markets Update (May 18, 2023)

19 May 2023 by rate3

On Thursday, jobless benefits decreased more than expected, while the Philadelphia Index rose, indicating better economic conditions and an increased probability of a rate hike. Nonetheless, NASDAQ (o: 12,513, c: 12,688) added 1.4 percent based on technicals, while BTC (o: 27,237, c: 26,734), which still lacks volumes, retreated 1.8 percent.

The BLS reported that jobless benefits fell to 242K in the week ending May 13th, below the expected 254K and down from an 18-month high of 264K. This indicates a tight labor market, potentially providing the FED with room for further rate hikes. There were significant decreases in claims in Massachusetts (-14.0K), Missouri (-2.3K), and New Jersey (-1.1K).

In May, the Philadelphia Fed Manufacturing Index rose to -10.4, marking the slowest pace in four months and showing improvement from April's -31.3. It also exceeded market expectations of -19.8. New orders (-8.9 vs -22.7) and shipments (-4.7 vs -7.3) increased, while employment experienced a decline (-8.6 vs -0.2).

Other Markets Updates:

Japan: The April's annual inflation rate jumped to 3.5% from March's 6-month low of 3.2%.

South Africa: March's building permits passed in largest municipalities slipped by 18% from a year ago to ZAR 9.1 million, following 12.7% rise in the prior month. The most affected sector is non-residential buildings (-52.5%). Residential segment decreased for much lesser extent (-4%).