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Market Brief – Friday 10/1/21

Stocks rose in overnight trading and continued higher after a brief dip in early trading. Treasury yields fell in overnight trading but sellers were quick to push yields back higher in early trading.

The Personal Consumption Expenditures (PCE) price index rose +0.4% in August and +4.3% from this time last year. Excluding food and energy, Core PCE rose +0.3% in August and +3.6% from this time last year.

Personal spending outpaced incomes as spending rose +0.8% while incomes rose +0.2% in August. Real, or inflation-adjusted consumption rose +0.4% in August.

The Markit Manufacturing PMI expanded at a slightly slower rate in September as it dipped to 60.7 from 61.1.

Construction spending was flat in August.

The “official” ISM Manufacturing PMI expanded at a slightly faster rate in September as it rose from 59.9 to 61.1. Employment and prices paid rose, while new orders were unchanged.

The University of Michigan Consumer Confidence survey showed a slight increase in confidence as current conditions improved as well as expectations. Inflation expectations were unchanged and 5-year inflation expectations rose slightly.

Stocks closed higher and Treasury yields lower on the day.