Weekly economic update for November 7, 2022

Weekly economic update for November 7, 2022

Putnam Investments | November 7, 2022

Highlights of key economic statistics from last week compiled by Putnam Investments.

economy

  • The S&P Global U.S. Manufacturing PMI declined to 50.4 in October from 52.0 in September.
  • The trade deficit widened in September, the Census Bureau found.
Employment

  • The U.S. added 261,000 jobs and the unemployment rate rose to 3.7% in October from 3.5% in September, according to the Bureau of Labor Statistics.
  • Initial jobless claims fell by 1,000 to 217,000 in the week ended October 29, 2022, the Department of Labor stated.
Profits

  • As of October 31, 2022, of the 276 S&P 500 Index companies reporting third-quarter earnings, 191 beat analysts’ estimates, according to S&P Dow Jones Indices.
Emotion

  • In the AAII Investor Sentiment Survey for the week ended November 2, 2022, bullish sentiment rose 4 percentage points and bearish sentiment declined 12.8 percentage points compared with the previous week.
Europe

  • Eurostat reported euro area GDP grew 0.2% in the third quarter compared with the previous quarter.
  • The S&P Global Eurozone Composite PMI Output Index fell to 47.3 in October from 48.1 in September.
  • Eurostat noted euro area annual inflation is expected to rise to 10.7% in October from 9.9% in September.
Rates

  • The yield on the 10-year Treasury note rose.
  • The Bank of England increased the bank rate by 75 basis points.
  • The Federal Reserve decided to raise the target range for the federal funds rate by 75 basis points.
Risks

  • High energy prices, worsened by the Russia-Ukraine War, increase the risk of stagflation and recession, even as central banks seek monetary policy normalization.
  • Declining liquidity and deteriorating financial conditions, combined with high valuations, are contributing to a substantial uptick in risk asset volatility.
  • Global leverage is at worrisome levels and will eventually need to be paid for, at a time when most developed markets are facing a fiscal drag from the end of post-pandemic stimulus.

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All economic and performance information is historical and does not guarantee future results. The views and opinions expressed are those of Putnam Investments, are subject to change with market conditions, and are not meant as investment advice.

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