To The Moon

Last week (week ending 24 Apr 2026), there weren’t significant US economic reports to leave a mark on the US market.

As a result, US listed companies quarterly earnings hogged the limelight, notably $Tesla Motors(TSLA)$ and $Intel(INTC)$.

Still, the reports out last week included:

• Tue, 21 Apr 2026 - US retail sales for March 2026.

• Thu, 23 Apr 2026 - US jobless claims - weekly and continuing.

• Thu, 23 Apr 2026 - S&P Flash US services & manufacturing PMI for April 2026 (preliminary).

• Fri, 24 Apr 2026 - Consumer sentiments (final) for April 2026.

US Retail sales.

US Census Bureau’s Retail sales report for March 2026, released on 21 Apr 2026, provides a complex snapshot of a consumer base that is resilient yet increasingly reactive to geopolitical and inflationary pressures.

Retail and food services sales for March 2026 surged by: (see above)

• MoM : up by +1.7% MoM to $752.1 million vs market expectations of +1.4% vs April 2025’s +1.4%.

• YoY : up by +4.00%.

• Q1 quarterly : up 3.7% vs Q1 2025’s 3.0%.

While the "blowout" headline suggests a booming retail environment, actual underlying data reveals that much of this growth was driven by external shocks rather than pure consumer optimism.

Energy Tax.

The most critical takeaway from the retail sales report is the impact of the ongoing conflict in the Middle East.

It is beginning to filter into US economic data, one month into the attack launched on 28 Feb 2026.

Gasoline station sales jumped by +15.5% in a single month, accounting for approximately 70% of the total monthly growth. Thank you Trump !

• More importantly, this indicates US consumers are now paying a "gas tax" due to geopolitical volatility that the Trump administration is trying to snuff out but with little success.

• When gasoline is excluded, the retail sales increase is a more modest +0.6%.

• Warning: Energy prices are a major headwind for discretionary spending. With US-Iran conflict remains unresolved beyond ceasefire deadline extension after extension, elevated fuel costs may begin to "crowd out" spending in other sectors.

With a looming mid-term election in November 2026, this does not bode well for Trump when there is less than 7 months to get US economy back on track.

Core Retail sales numbers.

Despite the gas spike, US "core" retail sales (excludes volatile categories - autos, gas, building materials, & food services) rose by +0.7%.

• This implies underlying US consumer remains on solid footing.

• Spending was robust in furniture (+2.2%), general merchandise (+1.0%), and non-store (online) retailers (+1.0%).

• This strength is likely bolstered by higher-than-average tax refunds, running approx. 11% higher than 2025.

• These one-time inflows are providing a temporary "buffer" against inflation, allowing households to continue purchasing durable goods and home furnishings for now.

Jobless Claims.

US Department of Labour’s jobless claims data reflects a labour market that remains historically tight but is beginning to show subtle signs of cooling amidst persistent geopolitical and inflationary headwinds.

Weekly claims.

For week ending 18 Apr 2026, weekly jobless claims rose by +6,000 to 214,000 claims. This is above the 210,000–212,000 consensus and up from previous week’s 208,000 the prior week. (see below)

Initial claims’ headline was a small miss, but not a troubling one.

This is because 214,000 is still firmly in a low layoff range by historical standards.

For now, weekly claims are at about midpoint of their 201,000-230,000 range for 2026, ​but could break higher in May and June, as has happened in recent years.

4-week average that smooths out noise and suggests a gradual, not abrupt, drift higher also inched up to 210,750 from last week’s 209,750.

Absence of widespread layoffs suggested by the report supports financial market expectations that the Fed will probably not cut interest rates during April 2026’s FOMC meeting, as the nearly 2-month conflict (a) fans the flame of inflation and (b) strains the global economy.

Continuing claims.

For week ending 11 Apr 2026, continuing claims rose by +12,000 to 1,821,000, that is marginally higher than analysts’s expectations of 1,820,000 and last week’s 1,809,000.

While the so-called continuing claims have retreated from last year's highs, that could partly be due to workers exhausting benefits, that are capped at 26 weeks in most states.

The data also excludes some unemployed young people with little or no work history, a group that is facing a difficult job market.

Looking at overall trend in continuing claims, it seems to indicate that the "cushion" for workers is thinning.

According to Citigroup, Economist, Gisela Young:

• Data continue to show a stable labour market.

• It will provide comfort to Fed officials ​that downside risks to the employment side of the mandate are not growing.

S&P Flash Purchasing Manager Index (PMI).

Services.

S&P Flash Services PMI for April 2026 (preliminary) increased by +1.7 to 51.5, from March 2026’s 49.8. (see below)

This is consistent with a subdued overall pace of expansion in the services economy where demand faltered.

Although recovering slightly from March’s dip, the rate of expansion was the 2nd weakest in the past year due to a further cooling of demand growth.

New business placed at service providers rose only marginally and at the slowest rate seen over the past 2 years, led by an ongoing decline in exports.

Businesses reported losing sales due to the war in the Middle East, government policies, and high prices making products unaffordable.

Manufacturing.

S&P Flash Manufacturing PMI for April 2026 (preliminary) also rose by +1.7 to 54.0 from March 2026’s 52.3, above consensus of around 52.5.

It is manufacturing PMI highest level since May 2022.

The expansion means factory business conditions have improved continually since August 2025.

Input inventories also made a positive contribution, rising marginally yet at the fastest rate since January 2026.

US Consumer Sentiments.

According to a long-running survey, anxiety about the war in Iran has left Americans in the grimmest economic mood on record.

The final April 2026 University of Michigan consumer sentiment index was revised upward from a preliminary 47.6 to 49.8. (see above)

Despite the revision, the final reading remains weak, falling below March 2026’s 53.3, that is below the previous low of 50 seen in June 2022.

That was when shoppers faced searing inflation, and the worst reading in the more than 50-year history of the Michigan survey.

Latest April 2026’s reading has reached a historical low, surpassing the gloom of 2008 financial crisis and 1970s stagflation era.

This is a negative signal for near-term consumer spending because sentiment is now back near recession-type trough levels.

Households are more worried about prices, policy uncertainty, and business conditions.

According to Surveys of Consumers, Director, Joanne Hsu:

• The Iran conflict appears to be a key influence on consumer views, primarily through shocks to gasoline and potentially other prices.

• The on and off diplomatic developments between US & Iran, that do not (a) lift supply constraints or (b) lower energy prices are unlikely to buoy consumers.

Repercussions.

A collapse in confidence signals mounting pressure on consumer spending, a critical driver of US growth.

The sharp drop in sentiment is not just psychological, it’s a warning sign that consumer demand, the backbone of US economy, may falter.

The data adds pressure on policymakers, as persistent inflation and weakening confidence complicate decisions on interest rates and fiscal support.

While employment remains relatively stable, the erosion of confidence highlights a disconnect between headline economic indicators and lived experiences of households.

Summary.

Last week’s reports paint a picture of the US economy that might be trapped in a stagflationary squeeze where retail growth is artificially inflated by surging oil prices (from the US-Iran conflict), while record-low consumer sentiment and rising service costs signal a deepening psychological recession.

Meanwhile, the "low-hire, low-fire" labour market and unanchored inflation expectations likely lock the Fed into maintaining high interest rates to prevent a total price spiral.

Are you concern ? I am because at worse the negatives might drag US market down, along with it.

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