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Economic and Earnings Data Deluge

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Like nearly every Thursday morning all year round, Initial Jobless Claims have hit the tape today, coming in exactly in-line with expectations at 360K — a new post-pandemic low. This is 26K lower than the upwardly revised 386K from the previous week, which was a week removed from the previous week’s 371K, which was the previous post-pandemic low.

This is a good sign for the labor market. A year ago, we were still seeing around 1.4 million new jobless claims per week.

Continuing Claims also hit an emphatic new low since the throes of Covid-19 hit U.S. employment: 3.24 million is a big step down from the slightly adjusted 3.37 million the previous week, and significantly below the 3.6 million plateau we’d been seeing for most of the past 12 weeks. Continuing Claims reports a week in arrears, so we may see these numbers go even lower next week.

Elsewhere, the Empire State Manufacturing Index ripped much higher for July — 43.0 is more than 2x higher than the 17.3 consensus estimate and June’s 17.4. This represents an all-time new high watermark for goods-producing in New York State, topping the 40 posted way back in 2004. It also demonstrates the Great Reopening has indeed created an historic surge in demand for goods.

The Philly Fed Manufacturing survey, also for July, does not show the same blockbuster growth: 21.9 is actually notably lower than the 27.0 anticipated, which was already notably below the 30.7 posted for June, and less than half April’s record 50.2. In fact, July’s print is the weakest on the Philly Fed since last December. Has manufacturing in Philadelphia already peaked in demand, or is this a blip on the screen"

The Import Price Index for June came in right in-line with expectations at a nice, round +1.0%, moderating from an upwardly revised 1.4% for May. Prices for things like import fuel, while remaining historically high, have come down sequentially, with overall import prices month over month shedding 40 basis points from May’s print, which itself was the highest level in almost 10 years.

June Export Prices were also in-line with estimates at +1.2%, for a 13th straight month of rising export prices. Again, we’re down from record levels set in May, but meat prices surging 10.6% led the way on export pricing. This was slightly offset by drops in all crucial grain categories (corn, wheat, soybean) month over month, while industrial supplies and materials went northward 1.9%.

For Q2 earnings, Morgan Stanley MS nicely outpaced estimates on both top and bottom lines this morning: $1.85 per share on $14.8 billion in revenues bettered the $1.63 per share and $13.92 billion in revenues expected. Equities trading totals gained more than expected, while the fixed-income business came in light — not unlike Morgan Stanley’s Wall Street rivals already reported. Shares are down 0.9% in pre-market trading.

Zacks Rank #2 (Buy)-rated UnitedHealth UNH also topped expectations for both earnings and sales in its Q2 release today: $4.70 per share easily surpassed the $4.48 in the Zacks consensus, while $71.3 billion in revenues improved over the $70.61 billion estimate, and +14.8% year over year. Current-year earnings per share guidance remains in the range of our $18.60 per share estimate. UNH has not missed on its bottom line since Q1 2008.

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