US consumption disappoints
In a country where consumption accounts for around two-thirds of GDP, consumers are always watched like a hawk. Since the beginning of the year, surveys have shown a decline in US consumer confidence. Even so, at this stage, consumption data is still solid.
That is at least until today's disappointing retail sales figures for April. The headline figure is slightly better than expected, at +0.1% against a consensus of 0. However, the control group – the equivalent of core inflation – is down 0.2% against an expected increase of 0.3%, which is a significant deviation.
"Control Group," retail sales. Source: US Census Bureau, Trading Economics
As always, MarketScreener's macro research teams remind us that we should not overinterpret statistics and that we should focus on trends. This is especially true now that all data will be distorted by stockpiling/destocking and advance purchases, which will subsequently lead to a slowdown in consumption—this may be what lies behind the decline in April. We therefore conclude, like Jerome Powell, that we must wait for "greater clarity."
Three-way battle for leadership of the US market
Apple, Microsoft and Nvidia - three iconic names in US tech. Three companies also vying for the position of world's largest by market capitalization. Microsoft currently holds the lead, with a market capitalization of just over $3.3 trillion.
Market capitalization of Apple, Microsoft, and Nvidia. Source: Bloomberg
Since the beginning of the year, US tech stocks have been subject to a correction after several years of exceptional performance. However, the rebound since mid-April has been significant against a backdrop of easing trade tensions. The Nasdaq has thus recovered by over 20% since its low on April 8.
Nevertheless, Apple is still down 18% from its high last December. Meanwhile, Nvidia is now only down 6% from its record high in early January, and Microsoft is down just 2% from its high last July.
Another successful start to the year for the UK
According to figures released Thursday by the Office for National Statistics (ONS), UK GDP grew by 0.7% on a quarterly basis, exceeding economists' expectations (0.6%). This positive figure was boosted by the manufacturing sector, as British companies produced more for export to the US ahead of the introduction of tariffs. This "frontloading" phenomenon, which has been seen across the globe, contributed to the strong first-quarter figures.
What is interesting in the UK is that since 2022, growth has been significantly higher in Q2 than in Q1. This phenomenon is not easy to explain, but could be due to price increases that companies implement at the beginning of the year and which are not fully taken into account in seasonal adjustments.
Source: Macrobond, ING
