UK GDP for 2Q15 Accelerates for 10th Consecutive Quarter
UK GDP improved 2.6% at the end of the second quarter. According to economists in a Bloomberg survey, UK GDP is expected to rise by 2.5% in 2015 and 2.3% in 2016.
EWG was down 0.57%, as Germany’s inflation and unemployment rate held steady despite the ECB’s (European Central Bank) monetary easing measures.
Economic confidence in the Eurozone got some relief as the Greek crisis settled with the troika granting further aid to Greece.
The consumer comfort index level was 40.5 in the week ending July 26, a fall of 1.9 points from last week’s 42.4.
US labor market conditions have a direct bearing on the performance of the consumer sector in the US. However, the recent uptick in jobless claims failed to weigh down consumer sector growth.
Second quarter GDP growth in the US fell short of market expectations. The two key factors restricting GDP growth in the US are decline in oil price and the strengthening US dollar.
The advanced estimate shows that GDP expanded by 2.3% in the second quarter of this year. In 1Q15, real GDP in the US increased by 0.6%.
A country’s net exports measure the value of total exports less the value of its total imports. It’s positive if exports are larger in value than imports.
A low unemployment rate indicates a strong economy. Jobs will only be announced when businesses are sure about a rise in orders for their goods and services.
Industrial production—or in some cases, manufacturing production—provides important input about a nation’s economic output, irrespective of its business cycle.
Inflation represents a rise in the general price level in a country or region. The higher the inflation, the lower the quantum of a particular good that can be purchased.
Economic growth can be considered among the most crucial indicators that are released. It indicates the growth in economic output.
For the week ending July 24, 2015, Biogen (BIIB) stock fell by -25.86%. The stock fell based on the downward revision of its 2015 revenue.
Within XBI, the top ten large-cap stocks by market cap outperformed the bottom ten stocks by market cap for the week ending July 24, 2015.
The continuing fall in the market might indicate a trend reversal for riskier assets. Profit-taking could push stocks down in excess of the broad market.
For the week ending July 24, 2015, the SPDR S&P Biotech ETF (XBI) fell -5.79% and underperformed the broader market index SPDR S&P 500 ETF (SPY).
Within the cyclical sectors, technology and financials are probably best positioned to ride out a rising rate environment.
The economic make-up of the US has changed significantly over the past century, making the Dow Theory less applicable today than it might once have been.
DJTI’s price-to-earnings ratio climbed from 15.7x at the start of 2013 to 20.2x at the end of 2014. This year, transportation stocks (IYT) have taken a hit, leading to multiple contractions.
The US recovery is tied to subdued US and global economic activity. This may explain some of the pullback in the Dow Transports.
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