North America In the U.S.: December IHS Markit flash manufacturing PMI was down 1.4 points m/m to 53.9 versus November’s 55.3 reading. New order growth was the weakest in over a year and manufacturing employment growth was the softest since Aug-17. REIT Focus: A report on Dealreporter stating that Simon Property Group (SPG) could have been weighing a bid for Macerich Company (MAC) was denied by a Simon spokesman to Bloomberg news. Shares of MAC had jumped over 7% on the news but later lost most of the gains following the denial by SPG. ASIA In China: The trade war with the US seems to be easing with both sides claiming constructive talks. In addition, China further eased tensions by
In the U.S.: November nonfarm payrolls fell to 155K versus October’s revised 237K reading. The unemployment rate was unchanged at 3.7% and labor force participation rate was unchanged at 62.9%. The slower than expected job growth increased the expectations of only one rate hike next year from the current expectation of two rate hikes. The trade discussions between China and the US seemed to take a stride forward last weekend when a trade truce was announced which would freeze new tariffs for 90 days as both sides negotiate a trade deal. However a lack of details regarding what was negotiated, tweets from US President Donald Trump calling himself “Tariff Man” and the arrest of the Huawei CFO, Meng Wanzhou, all
In the U.S.: Fed Chairman Jerome Powell seemed to strike a more dovish tone stating that “Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy — that is, neither speeding up nor slowing down growth,”. Although the comments jolted the markets to the upside, economists warned that Mr. Powell was not trying to shift expectations and just reiterating the current trajectory. REIT Focus: Marriott International, Inc. (MAR) announced a large data breach of its guest reservation database. The hack potentially released the personal details of over 500M customers going back as far as 2014. Marriott shares dove over 5% on Friday
In the U.S.: October retail sales were up 0.8% m/m versus September’s downwardly revised 0.1% decline. Gains were led by gasoline stations, auto dealers, department stores, and building materials/supplies. REIT Focus: Proxy firms ISS and Glass Lewis recommended the proposed Pebblebrook Hotel Trust (PEB) acquisition of LaSalle Hotel Properties (LHO). The move further bolsters the chances of the acquisition receiving a yes vote from shareholders. Lasalle’s CEO, Jon Bortz, commented that both proxy reports “clearly recognize the attractive strategic and financial rationale for the transaction, which serves the interests of shareholders of both companies.” In China: Speaking to reporters at the White House, President Trump stated that China wants to make a trade deal, but that it was unacceptable yet.
In the U.S.: As expected, the Fed left rates unchanged. Of note, the Fed reaffirmed that they were on course to raise rates in December. The Midterm election results saw the Democratic party win back the House of Representatives. Given the current partisan nature of Washington politics, it is widely expected that the new house will clash with the White House and make it very difficult for President Trump to implement his agenda. In earnings, 370 companies in the S&P 500 Index have reported, 82.2% beat, 0.9% were in-line, and 16.9% missed estimates. REIT Focus: Prologis, Inc. (PLD) and global real estate investor Ivanhoé Cambridge announced a 20/80 joint venture to develop and operate logistics real estate in Brazil. Operating