Economic and market updates

Economic Update for December 10, 2018

Highlights of news-making events of the past week, from the economy and profits to Europe and interest rates.

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economy

  • Construction spending fell 0.1% in October, the Commerce Department stated.
  • The trade deficit surged in October, reaching a 10-year high, the Commerce Department reported.
  • Factory orders declined 2.1% in October, the Commerce Department noted.
  • Durable goods orders fell 4.3% in October, according to the Commerce Department.

employment

  • Initial jobless claims fell by 4,000 to 231,000 in the week ended December 1, 2018, according to the Labor Department.
  • The U.S. added 155,000 jobs and the unemployment rate remained unchanged at 3.7% in November, according to the Bureau of Labor Statistics.

profits

  • As of November 30, 2018, of the 488 S&P 500 Index companies reporting third-quarter earnings, 376 — or 77.0% — beat analysts’ estimates, according to S&P Dow Jones Indices.

emotion

  • The University of Michigan’s index of consumer sentiment remained unchanged at 97.5 in December.

europe

  • Eurostat reported that retail trade rose 0.3% in October.
  • GDP grew 0.2% in the third quarter, Eurostat stated.
  • Eurozone industrial producer prices rose 0.8% in October, according to Eurostat.
  • Germany’s Federal Statistical Office reported that factory orders advanced 0.3% in October.

rates

  • The yield on the 10-year U.S. Treasury note declined.

risks

  • The strengthening U.S. dollar and widening credit spreads are putting pressure on select emerging markets.
  • The risk of a no-deal Brexit and a looming confrontation between the European Commission and Italy could tip Europe back into recession.
  • The Fed appears to be on course to invert the yield curve.

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.

Your clients should carefully consider the investment objectives, risks, charges, and expenses of a fund before investing. For a prospectus containing this and other information for any Putnam fund or product, call Putnam at 1-800-354-4000. Your clients should read the prospectus carefully before investing.