Dow dropped 70, decliners over advancers 3-1 & NAZ fell 10. The Financial Index lost1 to the 204s. The MLP index fell 2+ to the 386s & the REIT index was off 1+ to the 247s. The MLP index is back to where it was in early Dec. Junk bond funds gained & Treasuries are having another god day. Oil & gold pulled back modestly.
US wholesale businesses stepped up restocking in Feb, while expensive gasoline drove sales higher. The Commerce Dept said that stockpiles at the wholesale level rose at a 0.9% rate in Feb to $479B. The gov also revised Jan wholesale inventory growth to show a 0.6% increase, up from the initial reading of 0.4%. Sales at wholesale rose 1.2%, largely on the strength of gas, hardware, plumbing & heating equipment (after being unchanged in Jan). Faster inventory growth could lead to slightly slightly higher forecasts for broader economic growth in Q1. However, wholesale inventories are growing more slowly than they did at the end of last year which could lead to a modest negative contribution to Q1 growth. GDP growth in Q1 is forecasted to grow at an annual rate of 2%, down from the 3% rate in Q4. The first estimate of Q1 growth will come on Apr 27. Call this data inconclusive.
U.S. February Wholesale Inventories Rise 0.9%, Sales Climb 1.2%
Photo: Bloomberg
French business confidence stagnated & factory output dropped, underlining ahead of the country’s presidential election. A sentiment gauge for factory executives was unchanged at 95 in Mar after dropping in Feb, according to the Bank of France. Manufacturing production fell 1.2% in Feb, a 3rd month of declines. The data shows Europe's 2nd-largest economy is struggling to grow in the face of the region’s sovereign debt crisis, reducing the room for maneuver by the Presidential candidates as they seek voter support in the final weeks of the election campaign. The Bank of France said its surveys suggest that GDP didn’t expand in Q1. A lack of growth at least partly reflects the impact on demand of budget cuts in neighboring Italy & Spain, as well as deficit-reduction efforts in France. Spanish PM Rajoy is stepping up efforts to reassure investors he can bring the country’s deficit under control & prevent Spain from becoming the 4th country to require a bailout. He met with his health & education ministers yesterday to discuss cuts of more than €10B ($13B) as the gov reiterated its pledge to trim borrowing to 3% of GDP next year.
PM Monti
Photo: Bloomberg
Prime Minister Monti's efforts to overhaul the economy & protect Italy from a debt crisis may be overwhelmed by Spain's deepening fiscal woes & the fading effect of ECB 3-year lending. He sent parliament last week a plan to revamp the labor markets, which represents the most ambitious of his 4 major legislative efforts to make the Italian economy more competitive. This was greeted on by a 9 basis point increase in the country’s 10-year bond yield to 5.43% as Spain’s debt slumped on renewed concern the country would need a bailout. Italian borrowing costs fell more than 2 percentage points between Nov & the start of Mar following more ECB lending & Italian gov efforts to spur the economy. But Spain has revived contagion concerns after the gov abandoned its deficit target, contributing to 3 weeks of declines for Italian bonds. More countries in Europe are facing difficult sovereign debt problems.
Monti’s Overhaul Can’t Stop Pain From Spain: Euro Credit
Dow is down 200 this week as dreary news is taking hold going into earnings season which kicks off tonight. Disappointing news about the economy & growing concerns about European economies are getting the bulk of traders' attention. After Alcoa (AA), big banks will report earnings & the betting currently is for unsatisfactory reports.
JPMorgan Chase Capital XVI (AMJ) - tracks AMZ
Treasury yields:
U.S. 3-month | 0.081% | |
U.S. 2-year | 0.298% | |
U.S. 10-year | 2.003% |
| CLK12.NYM | ...Crude Oil May 12 | ...102.33 | ... 0.13 | (0.1%) |
| GCJ12.CMX | ....Gold Apr 12 | .........1,642.60 | ... 0.10 | (0.0%) |
Get the latest daily market update below:
US wholesale businesses stepped up restocking in Feb, while expensive gasoline drove sales higher. The Commerce Dept said that stockpiles at the wholesale level rose at a 0.9% rate in Feb to $479B. The gov also revised Jan wholesale inventory growth to show a 0.6% increase, up from the initial reading of 0.4%. Sales at wholesale rose 1.2%, largely on the strength of gas, hardware, plumbing & heating equipment (after being unchanged in Jan). Faster inventory growth could lead to slightly slightly higher forecasts for broader economic growth in Q1. However, wholesale inventories are growing more slowly than they did at the end of last year which could lead to a modest negative contribution to Q1 growth. GDP growth in Q1 is forecasted to grow at an annual rate of 2%, down from the 3% rate in Q4. The first estimate of Q1 growth will come on Apr 27. Call this data inconclusive.
U.S. February Wholesale Inventories Rise 0.9%, Sales Climb 1.2%
French business confidence stagnated & factory output dropped, underlining ahead of the country’s presidential election. A sentiment gauge for factory executives was unchanged at 95 in Mar after dropping in Feb, according to the Bank of France. Manufacturing production fell 1.2% in Feb, a 3rd month of declines. The data shows Europe's 2nd-largest economy is struggling to grow in the face of the region’s sovereign debt crisis, reducing the room for maneuver by the Presidential candidates as they seek voter support in the final weeks of the election campaign. The Bank of France said its surveys suggest that GDP didn’t expand in Q1. A lack of growth at least partly reflects the impact on demand of budget cuts in neighboring Italy & Spain, as well as deficit-reduction efforts in France. Spanish PM Rajoy is stepping up efforts to reassure investors he can bring the country’s deficit under control & prevent Spain from becoming the 4th country to require a bailout. He met with his health & education ministers yesterday to discuss cuts of more than €10B ($13B) as the gov reiterated its pledge to trim borrowing to 3% of GDP next year.
Photo: Bloomberg
Prime Minister Monti's efforts to overhaul the economy & protect Italy from a debt crisis may be overwhelmed by Spain's deepening fiscal woes & the fading effect of ECB 3-year lending. He sent parliament last week a plan to revamp the labor markets, which represents the most ambitious of his 4 major legislative efforts to make the Italian economy more competitive. This was greeted on by a 9 basis point increase in the country’s 10-year bond yield to 5.43% as Spain’s debt slumped on renewed concern the country would need a bailout. Italian borrowing costs fell more than 2 percentage points between Nov & the start of Mar following more ECB lending & Italian gov efforts to spur the economy. But Spain has revived contagion concerns after the gov abandoned its deficit target, contributing to 3 weeks of declines for Italian bonds. More countries in Europe are facing difficult sovereign debt problems.
Monti’s Overhaul Can’t Stop Pain From Spain: Euro Credit
Dow is down 200 this week as dreary news is taking hold going into earnings season which kicks off tonight. Disappointing news about the economy & growing concerns about European economies are getting the bulk of traders' attention. After Alcoa (AA), big banks will report earnings & the betting currently is for unsatisfactory reports.
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