📈 The US Economy Shows No Signs Off...?

Good morning. US stock futures rose in Friday morning trading as Wall Street parsed robust US economic data.

📈 US economy plows ahead

📝 Our report: The US economy is surprising everyone by defying slowdown fears. S&P Global's flash US composite PMI, which measures services and manufacturing activity, jumped to 54.4 in May from 51.3 in April, reaching a 25-month high.

 🔑 Key points:

• “The US economic upturn has accelerated again after two months of slower growth, with the early PMI data signaling the fastest expansion for just over two years in May," S&P Global Market Intelligence chief business economist Chris Williamson wrote in the release.

• Both the services and manufacturing sectors were in expansion mode, with services driving most of the gains for the composite index.

• Other recent data had indicated the economy is cooling. The April jobs report showed fewer job additions than expected and a pickup in the unemployment rate, while the preliminary reading of first quarter GDP showed the US economy grew at a slower pace than initially thought.

💡 So what: S&P Global's flash US composite PMI hitting a 25-month high indicates a robust economic performance, with increased activity in both the services and manufacturing sectors. This suggests that the economy is more resilient than expected, potentially easing fears of a slowdown and signaling continued growth. It reflects strong business confidence and consumer demand, which could lead to sustained economic expansion and stability in the near term.

Friday - Consumer Sentiment (final), Fed Gov Christopher Waller Speaks

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💳 Credit card debt bites consumers

WHAT: Consumers are having a hard time paying their credit card bills, sparking worries about rising delinquencies and a hit to spending. The share of credit card debt over 90 days overdue hit 10.7% in the first quarter, the highest in 14 years, according to the Federal Reserve Bank of New York.

WHY: The Federal Reserve hiked its key interest rate rate to a 23-year high to combat four-decade high inflation, which peaked in June, 2022 at 9.1%. Those rate increases made borrowing more expensive on mortgages, auto loans and credit cards.

🎵 TikTok installs new rules to ringfence state media accounts

WHAT: TikTok is rolling out new rules to rein in state-affiliated media accounts trying to meddle in foreign elections during this crucial election year. The company, which started labeling state-affiliated media two years ago, announced in a statement that identified accounts attempting to “reach communities outside their home country on current global events and affairs” will not appear on the main feed where users watch videos.

WHY: The spread of foreign propaganda is also a problem on other social media platforms, such as Meta-owned Facebook and Instagram, as well as Elon Musk’s X. However, TikTok, which is owned by Beijing-based ByteDance, has been at the center of a heated political debate, with many US lawmakers and some administration officials arguing it poses a more serious national security threat and could potentially operate at the whims of China's government.

🦾 US govt doles out cash to South Korean chip making factory in Georgia

WHAT: The US federal government is splashing out $75 million to help build a glass parts factory for computer chips in Georgia, part of the Biden administration’s plan to bring manufacturing jobs back to the US and secure the supply of highly valued computer chips. The U.S. Department of Commerce announced the investment in Absolics, part of South Korea's SK Group.

WHY: The Department of Commerce said this is the first time the CHIPS and Science Act has been used to fund a factory making a new advanced material for semiconductors. The 2022 federal law authorized the spending of $280 billion to aid the research and manufacturing of semiconductors in the United States.

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