ISM Manufacturing Index

After a strong rebound in the second quarter, the momentum in the industrial sector is showing signs of slowing. While still in growth mode, the recent ISM Index fell slightly, to 55.4%. This may be setting the pace for economic growth trends for the rest of the year and into 2021. While the industrial sector is only 10% of GDP, it is a reasonable proxy for overall demand.

U.S. & World Equity Indexes; 10/26/20; YTD Return S&P 500; 3,401; 5.49% Dow Jones Industrials; 27,655; -3.09% Nasdaq Composite; 11,406; 27.13% Shanghai Composite (China); 3,254; 6.69% S&P BSE Sensex (India); 40,522; -1.77% Nikkei Stock Avg (Japan); 23,485; -0.72% CAC 40 (France); 4,761; -20.36% DAX (Germany); 12,118; -8.09% FTSE 100 (U.K.); 5,770; -23.18%
Selected Interest Rates; 10/26/20; 9/1/20 15-Year Mortgage; 2.33%; 2.461% 30-Year Mortgage; 2.80%; 2.91% 5-Year Treasury Bond; 0.35%; 0.26% 10-Year Treasury Bond; 0.81%; 0.68% 30-Year Treasury Bond; 1.59%; 1.43%
Key Economic Statistics; Most Recent; Prior Month National Producer Price Index; 0.40%; 0.30% Consumer Price Index; 0.20%; 0.40% Unemployment Rate; 7.90%; 8.40% ISM Manufacturing Index; 55.40; 56.00 ISM Services Index; 57.80; 56.90 Change in Non-farm Payroll Emp.; 661,000; 1,371,000 New York State Consumer Price Index - NY, NJ, CT; 0.40%; -0.10% Unemployment Rate; 9.70%; 12.50% Empire State Manufacturing Survey; 10.50%; 17.00%

Initial Unemployment Claims, 4-Week Moving Average

Unemployment trends continue to improve. The overall unemployment rate fell to 7.4% in the most recent survey, while the 4-week average of unemployment insurance claims fell to 811,250 new filings. This remains far above the levels of 2019 and early 2020. Given continuing COVID-19-related constraints, the unemployment level is expected to be well above normal into 2021.

Equity Market Statistics; Most Recent; Prior Month Dow Jones Industrials; 10/26/20; 9/1/20 Dividend Yield; 2.37%; 2.313% Price/Earnings (12-Mth Trailing); 26.58; 27.28 Price/Earnings (Projected); 24.15; 25.01 S&P 500 Index; 10/26/20; 9/1/20 Dividend Yield; 1.70%; 1.62% Price/Earnings (12-Mth Trailing); 31.24; 22.22 Price/Earnings (Projected); 21.75; 24.29

The information herein was obtained from various sources believed to be accurate; however, Forté Capital does not guarantee its accuracy or completeness. This report was prepared for general information purposes only. Neither the information nor any opinion expressed constitutes an offer to buy or sell any securities, options, or futures contracts. Forté Capital’s Proprietary Market Risk Barometer is a summary of 30 indicators and is copyrighted by Forté Capital LLC. For further information, visit www.fortecapital.com, send a message to [email protected], or call 866-586-8100 and ask for David W. Henion, CPA, or Larry H. Rabinowitz, CPA/PFS.