Manufacturing Production Exceeds Expectations, SP500 Tests Session Lows

Key Insights

• Industrial Production grew by 0.5% in April. 
• Manufacturing Production increased by 1% in April. 
• Business Inventories declined by 0.1% in March. 

Industrial Production Growth Beat Analyst Estimates

On May 16, U.S. released Industrial Production report for April. The report indicated that Industrial Production increased by 0.5% month-over-month, compared to analyst consensus of 0%. On a year-over-year basis, Industrial Production grew by 0.2%.

Manufacturing Production has also exceeded expectations, rising by 1% on a month-over-month basis, compared to analyst consensus of +0.1%. It should be noted that growth rates for both February and March were revised down 0.3 percentage point. On a year-over-year basis, Manufacturing Production declined by 0.9%, compared to analyst forecast of -2.3%.

Traders also had a chance to take a look at the Business Inventories report for March, which showed that Business Inventories declined by 0.1% compared to analyst consensus of 0%.

Gold Pulls Back Towards The $2000 Level

U.S. Dollar Index gained ground after the release of the better-than-expected Manufacturing Production data. Treasury yields are moving higher, providing additional support to the American currency.

SP500 is trying to settle below the support level at 4115. Traders are cautious as debt ceiling negotiations continue. The weaker-than-expected Retail Sales report served as an additional bearish catalyst for SP500.

Gold is moving towards the $2000 level as traders focus on stronger dollar and rising Treasury yields. Interestingly, debt ceiling worries do not provide additional support to gold markets in today’s trading session.

For a look at all of today’s economic events, check out our economic calendar.