by Calculated Risk on 7/01/2010 02:40:00 PM

From HotelNewsNow.com: STR reports US results for week ending 26 June 2010

In year-over-year measurements, the industry's occupancy last week increased 6.8 percent to 69.7 percent. Average daily rate rose 1.1 percent to US$98.79. Revenue per available room rose 7.9 percent to US$68.88.

The following graph shows the four week moving average for the occupancy rate by week for 2008, 2009 and 2010 (and a median for 2000 through 2007).

Click on graph for larger image in new window.

Notes: the scale doesn't start at zero to better show the change.

On a 4-week basis, occupancy is up 5.4% compared to last year (the worst year since the Great Depression) and still 7.7% below normal. About half way back ...

Last year leisure travel held up better than business travel and leisure travel (summer) is the key for the next couple of months.

Data Source: Smith Travel Research, Courtesy of HotelNewsNow.com

by Calculated Risk on 7/01/2010 12:25:00 PM

Overall construction spending declined in May, and private construction spending, both residential and non-residential, also decreased. From the Census Bureau: May 2010 Construction at $841.9 Billion Annual Rate

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during May 2010 was estimated at a seasonally adjusted annual rate of $841.9 billion, 0.2 percent below the revised April estimate of $843.3 billion.
...
Spending on private construction was at a seasonally adjusted annual rate of $536.3 billion, 0.5 percent below the revised April estimate of $538.9 billion. Residential construction was at a seasonally adjusted annual rate of $260.8 billion in May, 0.4 percent below the revised April estimate of $261.7 billion. Nonresidential construction was at a seasonally adjusted annual rate of $275.6 billion in May, 0.6 percent below the revised April estimate of $277.2 billion.

Click on graph for larger image in new window.

This graph shows private residential and nonresidential construction spending since 1993. Note: nominal dollars, not inflation adjusted.

Private residential construction spending appears to have bottomed in early 2009, but has only increased gradually since then. Residential spending is now 61% below the peak of early 2006.

Private non-residential construction spending is now 33% below the peak of late 2008.

Private residential construction spending will decline sharply in July as builders complete homes in June.

Based on the Architecture Billings Index, non-residential spending will also decline all year - and well into 2011.

Residential spending will probably exceed non-residential later this year (or early 2011), but that will be mostly because of weakness in non-residential construction, as opposed to any significant increase in residential spending.

by Calculated Risk on 7/01/2010 11:00:00 AM

From MarketWatch: General Motors U.S. June sales rise 10.7%.

General Motors Co. said Thursday that June U.S. sales rose 10.7% to 195,380 vehicles from 176,571 in the year-ago period.

This seems very weak considering GM was in bankruptcy last June.

This is based on an easy comparison in several ways: in June 2009 U.S. light vehicle sales fell almost 30% to 9.7 million (SAAR) from 13.8 million (SAAR) in June 2008. The sharp decline last year was due to the financial crisis, the recession, and of course the Chrysler and GM bankruptcy filings (Chrysler filed for bankruptcy at the end of April, 2009 and GM filed for bankruptcy on June 1, 2009).

I'll add reports from the other major auto companies as updates to this post.

Update 1: From MarketWatch: Ford total sales rise 13.3% to 175,895 units

Update 2: From MarketWatch: Chrysler U.S. June sales jump 35% to 92,482 units

Update 3: From MarketWatch: Toyota U.S. June sales rise 6.8% to 140,604 units

NOTE: Once all the reports are released, I'll post a graph of the estimated total June sales (SAAR: seasonally adjusted annual rate) - usually around 4 PM ET. Most estimates are for a decrease to 11.4 million in June from the 11.6 million SAAR in May.

by Calculated Risk on 7/01/2010 10:00:00 AM

A two-in-one post ...

PMI at 56.2% in June down from 59.7% in May.

From the Institute for Supply Management: June 2010 Manufacturing ISM Report On Business®

Economic activity in the manufacturing sector expanded in June for the 11th consecutive month, and the overall economy grew for the 14th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business®.

The report was issued today by Norbert J. Ore, CPSM, C.P.M., chair of the Institute for Supply Management™ Manufacturing Business Survey Committee. "The manufacturing sector continued to grow during June; however, the rate of growth as indicated by the PMI slowed when compared to May. The lower reading for the PMI came from a slowing in the New Orders and Production Indexes. We are now 11 months into the manufacturing recovery, and given the robust nature of recent growth, it is not surprising that we would see a slower rate of growth at this time. The sector appears to be solidly entrenched in the recovery. Comments from the respondents remain generally positive, but expectations have been that the second half of the year will not be as strong in terms of the rate of growth, and June appears to validate that forecast."
...
ISM's New Orders Index registered 58.5 percent in June, which is a decrease of 7.2 percentage points when compared to the 65.7 percent reported in May.
...
ISM's Employment Index registered 57.8 percent in June, which is 2 percentage points lower than the 59.8 percent reported in May.
emphasis added

And from the NAR: Pending Home Sales Drop as Expected

The Pending Home Sales Index, a forward-looking indicator, dropped 30.0 percent to 77.6 based on contracts signed in May from a reading of 110.9 in April ... NAR chief economist Lawrence Yun said, “The sharp decline in contract signings in May is a natural result with similar low levels of sales activity anticipated in June.”

Both the ISM index and pending home sales were below consensus.

by Calculated Risk on 7/01/2010 08:30:00 AM

The DOL reports on weekly unemployment insurance claims:

In the week ending June 26, the advance figure for seasonally adjusted initial claims was 472,000, an increase of 13,000 from the previous week's revised figure of 459,000. The 4-week moving average was 466,500, an increase of 3,250 from the previous week's revised average of 463,250.
...
The advance number for seasonally adjusted insured unemployment during the week ending June 19 was 4,616,000, an increase of 43,000 from the preceding week's revised level of 4,573,000.

Click on graph for larger image in new window.

This graph shows the 4-week moving average of weekly claims since January 2000.

The four-week average of weekly unemployment claims increased this week by 3,250 to 466,500.

The dashed line on the graph is the current 4-week average.

Initial weekly claims have been at about the same level since December 2009. Historically the current level of 472,000, and 4-week average of 466,500, would suggest ongoing weakness in the labor market.