Dow jumped 159, advancers over decliners 3-1 & NAZ was up 37. Banks led the way on the bailout talk from Europe. The Financial Index is 3 under its highs reached on Wed.
The MLP index was up 1 to the 371s & the REIT index rose 3 to 222. Junk bond funds gained a few pennies & Treasures slipped, taking the yield on the 10 year Treasury bond back to 2%. Oil was holding even after a tough week which took it below $100. Gold also did little.
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The 17 countries that use the €, plus nearly all of their European Union partners, agreed to an ambitious treaty tying their finances together in the hopes of solving Europe's debt crisis. But opposition led by Britain created a deep rift in the union. Can you spell, "Uh-oh?" The countries hope to help European nations struggling with giant debts over the long term & there were early indications of success. Such an agreement is considered necessary before the ECB & other institutions commit more money to lowering the borrowing costs of heavily indebted countries like Italy & Spain. "It's a very good outcome for the euro area, very good," ECB President Draghi said. "It is going to be the basis for much more disciplined economic policy for euro-area members. And certainly it is going to be helpful in the present situation." However Draghi has yet to say whether the ECB will take more aggressive action to buy the bonds of heavily indebted countries. Unfortunately the political implications of the rift are enormous. Germany & France had hoped to persuade all 27 EU countries to agree to change the treaty that governs their union. But Britain, which doesn't use the €, firmly said no, arguing that the revised treaty would threaten their national sovereignty & damage London's esteemed financial services industry. More work needs to get done before this is a done deal!
EU Leaders Drop Demands for Investor Write-Offs
Photo: Yahoo
Consumer sentiment rose to its highest in 6 months in early Dec due to an improving outlook on the economy. Reduced consumer pessimism could reduce jitters about a pullback in consumer spending. The Thomson Reuters/University of Michigan's preliminary reading on the index of consumer confidence climbed for a 4th straight month to 67.7, up from 64.1 in Nov & a low of 55.7 back in Aug. The figure exceeded the 65.5 predicted. "News about recent economic developments were much more positive in early December. Reports of net job growth have increased in each of the past three months, as have assessments of current conditions in the economy," survey director Richard Curtin said. However, the latest survey showed consumers still have a dire view of their personal finances as the job growth remains sluggish & worries over federal economic policies. "The recent gains in confidence are especially vulnerable given that judgments of economic policies remain near all-time lows" Curtin said. The gauge of consumer expectations jumped to 61.1 from 55.4 in Nov. The survey's one-year inflation expectation dipped to 3.1% in early Dec, while the survey's 5-10-year inflation outlook held steady at 2.7%t for a 3rd month in a row. Moderately good news for consumer confidence.
Texas Instruments cut its outlook for the current qtr & warned demand was broadly lower as customers reduce their inventories. Weak economies in the US & Europe have sapped demand for microchips. Sales of its OMAP application processors, used in the Kindle Fire tablets, have been better than expected. But worries about slow demand have pushed manufacturers in recent months to trim inventories of chips & other components, a trend that is continuing. Sales of TXN chips used in PCs are down in the current qtr, partly due to a shortage of hard-drives caused by recent flooding in Thailand which is expected to cause interruptions in PC manufacturing. Europe, struggling with a deepening sovereign debt crisis, is the weakest market. TXN expects Q4 revenue of $3.19-$3.33B compared with its earlier forecast of $3.26-$3.54B. The stock fell 59¢. The implications for the macro economic picture are not good.
Texas Instruments Falls Most in 4 Months After Missing Estimates
S&P 500 Financials Sector Index
| Value | 175.85 | |
| Change | 3.75 (2.2%) |
The MLP index was up 1 to the 371s & the REIT index rose 3 to 222. Junk bond funds gained a few pennies & Treasures slipped, taking the yield on the 10 year Treasury bond back to 2%. Oil was holding even after a tough week which took it below $100. Gold also did little.
AMZ Alerian MLP Index
DJR Dow Jones Equity REIT Index
Treasury yields:
U.S. 3-month | 0.000% | |
U.S. 2-year | 0.218% | |
U.S. 10-year | 2.002% |
| CLF12.NYM | ...Crude Oil Jan 12 | ...98.30 | ... 0.04 (0.0%) |
| GCZ11.CMX... | Gold Dec 11 | ....1,712.60 | ... 2.80 | (0.2%) |
Get the latest market update below:
The 17 countries that use the €, plus nearly all of their European Union partners, agreed to an ambitious treaty tying their finances together in the hopes of solving Europe's debt crisis. But opposition led by Britain created a deep rift in the union. Can you spell, "Uh-oh?" The countries hope to help European nations struggling with giant debts over the long term & there were early indications of success. Such an agreement is considered necessary before the ECB & other institutions commit more money to lowering the borrowing costs of heavily indebted countries like Italy & Spain. "It's a very good outcome for the euro area, very good," ECB President Draghi said. "It is going to be the basis for much more disciplined economic policy for euro-area members. And certainly it is going to be helpful in the present situation." However Draghi has yet to say whether the ECB will take more aggressive action to buy the bonds of heavily indebted countries. Unfortunately the political implications of the rift are enormous. Germany & France had hoped to persuade all 27 EU countries to agree to change the treaty that governs their union. But Britain, which doesn't use the €, firmly said no, arguing that the revised treaty would threaten their national sovereignty & damage London's esteemed financial services industry. More work needs to get done before this is a done deal!
EU Leaders Drop Demands for Investor Write-Offs
Consumer sentiment rose to its highest in 6 months in early Dec due to an improving outlook on the economy. Reduced consumer pessimism could reduce jitters about a pullback in consumer spending. The Thomson Reuters/University of Michigan's preliminary reading on the index of consumer confidence climbed for a 4th straight month to 67.7, up from 64.1 in Nov & a low of 55.7 back in Aug. The figure exceeded the 65.5 predicted. "News about recent economic developments were much more positive in early December. Reports of net job growth have increased in each of the past three months, as have assessments of current conditions in the economy," survey director Richard Curtin said. However, the latest survey showed consumers still have a dire view of their personal finances as the job growth remains sluggish & worries over federal economic policies. "The recent gains in confidence are especially vulnerable given that judgments of economic policies remain near all-time lows" Curtin said. The gauge of consumer expectations jumped to 61.1 from 55.4 in Nov. The survey's one-year inflation expectation dipped to 3.1% in early Dec, while the survey's 5-10-year inflation outlook held steady at 2.7%t for a 3rd month in a row. Moderately good news for consumer confidence.
Texas Instruments cut its outlook for the current qtr & warned demand was broadly lower as customers reduce their inventories. Weak economies in the US & Europe have sapped demand for microchips. Sales of its OMAP application processors, used in the Kindle Fire tablets, have been better than expected. But worries about slow demand have pushed manufacturers in recent months to trim inventories of chips & other components, a trend that is continuing. Sales of TXN chips used in PCs are down in the current qtr, partly due to a shortage of hard-drives caused by recent flooding in Thailand which is expected to cause interruptions in PC manufacturing. Europe, struggling with a deepening sovereign debt crisis, is the weakest market. TXN expects Q4 revenue of $3.19-$3.33B compared with its earlier forecast of $3.26-$3.54B. The stock fell 59¢. The implications for the macro economic picture are not good.
Texas Instruments Falls Most in 4 Months After Missing Estimates
TXN Texas Instruments
Markets are having another good day. Even with the gyrations, Dow is up 1% this week. The Euro announcement today is still a bit fuzzy. They are using Scotch-Tape to patch together problems & England is not buying it. France & Germany also expect the weaklings to adopt tough standards which may not work out. Consumer confidence data sounds good, but even these numbers are fluid, dependent on goings on in DC. Not sure if these gains will last today.
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