Dow jumped 164, advancers ahead of decliners 7-1 & NAZ was up 41. As has been the case for some time, bank stocks are leading the way up. The Financial Index is up an impressive 20 off its lows last week.
The MLP index was up 2 to the 376s & the REIT index gained 3 to the 223s. Junk bond funds were a little higher & Treasuries sold off with the rising stock markets. Oil rose for a 2nd day on concern that tension in the MidEast will threaten supplies & as the Italian Prime Minister proposed budget cuts before a European debt-crisis summit. Gold is unsure where to go.
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Companies decreased orders to US factories in Oct for a 2nd straight month. The Commerce Dept said total factory orders fell 0.4% & the Sep modest 0.3% increase was also revised to show a 0.1% drop. Demand for capital goods, a good proxy for business investment, fell 0.8%. Orders for durable goods fell 0.5%, reflecting weakness in commercial aircraft & autos. Orders for nondurable goods were down 0.3%. Auto sales & production are up now that supply chain disruptions caused by the earthquake in Japan have eased. Also, consumers have stepped up spending since high gas prices chipped away at their paychecks last spring. The economic recovery is giving mixed signals.
US factory orders fall for second straight month AP
Photo: Bloomberg
Premier Monti told Italian lawmakers there is "no alternative" but to pass his anti-crisis package of new taxes, pension reform & growth measures because the world is focusing attention on Italy & on Parliament to do what is necessary to avoid financial disaster. His package includes €30B ($40B) in spending cuts & tax hikes & €10B ($13½B) to boost Italy's anemic growth. The gov agreed for taxes on primary residences & luxury goods like yachts, high-performance cars & private airplanes, increase the age at which retirees can draw full pensions, trim the cost of Italy's political class & give incentives to companies that hire women & young workers. "Without this package, we believe Italy would collapse, Italy would go into a situation like that of Greece, a country we admire but we don't want to imitate," he said. The package, passed as an emergency decree, takes immediate effect but Parliament must still approve it within 60 days. The Senate president has said he expected passage before Christmas, although lawmakers indicated they want changes. Monti acknowledged that some of the more painful measures might aggravate Italy's looming recession, with the gov forecasting an economic contraction of up to 0.5% next year, followed by no growth in 2013. But these measures are necessary to bring down bond yields, that would give Italy more financial relief than any negative impact from individual measures.
Monti Seeks Support for $40 Billion Austerity Package to Trim Italy Debt
Photo: Bloomberg
The German gov won’t stand in the way of Bundesbank help to fight the debt crisis with loans channeled through the IMF. Germany wants the IMF to adopt a “decisive role” in combating the crisis alongside the European rescue fund. “If the IMF says it needs more money, then it’s up to the Bundesbank to decide this in Germany’s case,” a spokesman for Chancellor Merkel said. “It’s not for lawmakers nor Frau Merkel’s government to decide or to interfere.” Lawmakers “would have a problem if political pressure was openly brought to bear on the bank, not with its decision.” Merkel & French President Sarkozy agreed to press fellow leaders at a Dec 8-9 EU summit to lock in tighter economic cooperation as a first step to snuff out the crisis, now in its 3rd year. Euro finance ministers gave the go-ahead last week for work on a proposal to recycle central bank loans thru the IMF that may deliver up to €200B ($269B) to fight the crisis. Consider this a "work in progress" involving $Bs.
Germany Won’t Prevent Bundesbank From Lending Crisis-Fighting Funds to IMF
Buyers are back in force. Dow is up an amazing 1K off its lows last week, on the hopes that the IMF, EU, Germany, whoever, will bail out the weak countries in Europe. Maybe. There is a big summit at the end of the week when thoughts will have to be translated in actions. Countries like Greece & Italy will need to accept ugly austerity measures. There have been large protests in Greece, but the gov plods on with its plans. Maybe Santa Claus will bring a rally. Dow is bumping against the 12.2K ceiling. Breaking thru it could be significant.
Dow Jones Industrial Average
S&P 500 Financials Sector Index
| Value | 177.46 | |
| Change | 4.32 (2.5%) |
The MLP index was up 2 to the 376s & the REIT index gained 3 to the 223s. Junk bond funds were a little higher & Treasuries sold off with the rising stock markets. Oil rose for a 2nd day on concern that tension in the MidEast will threaten supplies & as the Italian Prime Minister proposed budget cuts before a European debt-crisis summit. Gold is unsure where to go.
AMZ Alerian MLP Index
DJR Dow Jones Equity REIT Index (INDEX)
Treasury yields:
U.S. 3-month | -0.005% | |
U.S. 2-year | 0.262% | |
U.S. 10-year | 2.098% |
| CLF12.NYM | ...Crude Oil Jan 12 | ...102.08 | .... 1.12 | (1.1%) |
| GCZ11.CMX | ...Gold Dec 11 | ......1,744.30 | .... 2.70 | (0.2%) |
Get the latest market update below:
Companies decreased orders to US factories in Oct for a 2nd straight month. The Commerce Dept said total factory orders fell 0.4% & the Sep modest 0.3% increase was also revised to show a 0.1% drop. Demand for capital goods, a good proxy for business investment, fell 0.8%. Orders for durable goods fell 0.5%, reflecting weakness in commercial aircraft & autos. Orders for nondurable goods were down 0.3%. Auto sales & production are up now that supply chain disruptions caused by the earthquake in Japan have eased. Also, consumers have stepped up spending since high gas prices chipped away at their paychecks last spring. The economic recovery is giving mixed signals.
US factory orders fall for second straight month AP
Premier Monti told Italian lawmakers there is "no alternative" but to pass his anti-crisis package of new taxes, pension reform & growth measures because the world is focusing attention on Italy & on Parliament to do what is necessary to avoid financial disaster. His package includes €30B ($40B) in spending cuts & tax hikes & €10B ($13½B) to boost Italy's anemic growth. The gov agreed for taxes on primary residences & luxury goods like yachts, high-performance cars & private airplanes, increase the age at which retirees can draw full pensions, trim the cost of Italy's political class & give incentives to companies that hire women & young workers. "Without this package, we believe Italy would collapse, Italy would go into a situation like that of Greece, a country we admire but we don't want to imitate," he said. The package, passed as an emergency decree, takes immediate effect but Parliament must still approve it within 60 days. The Senate president has said he expected passage before Christmas, although lawmakers indicated they want changes. Monti acknowledged that some of the more painful measures might aggravate Italy's looming recession, with the gov forecasting an economic contraction of up to 0.5% next year, followed by no growth in 2013. But these measures are necessary to bring down bond yields, that would give Italy more financial relief than any negative impact from individual measures.
Monti Seeks Support for $40 Billion Austerity Package to Trim Italy Debt
The German gov won’t stand in the way of Bundesbank help to fight the debt crisis with loans channeled through the IMF. Germany wants the IMF to adopt a “decisive role” in combating the crisis alongside the European rescue fund. “If the IMF says it needs more money, then it’s up to the Bundesbank to decide this in Germany’s case,” a spokesman for Chancellor Merkel said. “It’s not for lawmakers nor Frau Merkel’s government to decide or to interfere.” Lawmakers “would have a problem if political pressure was openly brought to bear on the bank, not with its decision.” Merkel & French President Sarkozy agreed to press fellow leaders at a Dec 8-9 EU summit to lock in tighter economic cooperation as a first step to snuff out the crisis, now in its 3rd year. Euro finance ministers gave the go-ahead last week for work on a proposal to recycle central bank loans thru the IMF that may deliver up to €200B ($269B) to fight the crisis. Consider this a "work in progress" involving $Bs.
Germany Won’t Prevent Bundesbank From Lending Crisis-Fighting Funds to IMF
Buyers are back in force. Dow is up an amazing 1K off its lows last week, on the hopes that the IMF, EU, Germany, whoever, will bail out the weak countries in Europe. Maybe. There is a big summit at the end of the week when thoughts will have to be translated in actions. Countries like Greece & Italy will need to accept ugly austerity measures. There have been large protests in Greece, but the gov plods on with its plans. Maybe Santa Claus will bring a rally. Dow is bumping against the 12.2K ceiling. Breaking thru it could be significant.
Dow Jones Industrial Average
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