Daily Commentary

MarketMinder’s View: Judging by South Korean exports—a bellwether for global trade—world shipping has bounced back in a big way. The country’s exports soared 13.8% y/y in April, accelerating from March’s 3.1%, for their seventh straight month of growth. Leading the upswing: semiconductors’ 56.1% y/y leap, suggesting the chip cycle may have turned higher. Also notable: Korean exports to the US rose 24.3% y/y to hit a record, overtaking exports to China for a third month. Now, these trade data are still backward looking and just confirm activity that forward-looking global stocks have long since pre-priced. But we think it illustrates global commerce’s resilience, an example of reality proving better than initially expected.

MarketMinder’s View: After entering expansion territory in March, April’s Institute for Supply Management (ISM) manufacturing purchasing managers’ index (PMI) fell -1.1 points to 49.2—signaling contraction (below 50) for the sector again. Also receiving attention, the prices paid subindex rose 5.1 points to 60.9, its highest since June 2022. As the article relates, “The readings indicate US manufacturing is struggling for traction after some optimistic signs earlier this year for the industry’s outlook. Producers continue to battle headwinds of higher interest rates, elevated input costs and sluggish overseas markets.” While not great, a few things to note. First, manufacturing is a small slice of the US economy. Its prior struggles didn’t hinder overall growth. Two, PMIs measure breadth, not magnitude—for growth and prices. Readings below 50 aren’t necessarily contractionary if the output of the minority of firms reporting growth outweighs those shrinking. Similarly, a rise in the index of prices paid doesn’t reveal how much more firms are paying—just that more saw higher prices, which could be a little or a lot. Lastly, S&P Global’s manufacturing PMI measure, while directionally similar to ISM’s, fell -1.9 points to 50—again, not great, but a sign that the overall manufacturing backdrop is more “meh” than in major trouble. Broadly flat manufacturing activity to start Q2 leaves a lot to be desired, but it is a condition the economy has weathered fine—and stocks are well familiar with.

MarketMinder’s View: Here are some alarming statistics: “Reports of criminal schemes targeting seniors in the U.S. increased by 14% between 2022 and 2023, federal investigators said, warning that investment scams in which victims are enticed into transferring money to fraudulent financial institutions are the costliest to the elderly. In all, over 101,000 complaints of fraud perpetrated against individuals over 60 years of age were filed to federal law enforcement last year, the most of any age group throughout the country.” And the numbers are likely far higher since many fraud scams go unreported. Also troublingly, victims often know the bad actors in the bulk of scams. Other fraudsters use elaborate schemes to gain victims’ trust, e.g., impersonating federal agents, tech support systems and financial institutions. They can also pose as family members (often grandchildren) or romantic interests. To avoid getting caught in their tricks and traps takes vigilance. First, be aware of fraudsters’ favored tactics and how they operate. Then you can better defend against them, like never handing over custody of your money to anyone, no matter how (seemingly) enticing or pressing the situation. A bit of attention can go a long way in protecting your assets. Oh, and a reminder: Seniors may be the subject of this report, but fraud is a risk for people of all ages.