Dow lost 2, decliners just ahead of advancers & NAZ fell 16. The Financial Index was down a fraction, but remained above 210. The MLP index fell a fraction to the 396s & the REIT index was off 1+ (from its 2012 high) to the 269s. Junk bond funds were a little lower as were Treasuries. Oil & gold pulled back after strength in the last month.
Photo: Bloomberg
China imports unexpectedly fell & industrial output rose the least in 3 years, signaling more stimulus may be needed after the gov last week said it approved subway & road projects across the nation. Inbound shipments slid 2.6% in Aug from a year earlier as exports rose 2.7%, the customs bureau said. Production increased 8.9%, the National Bureau of Statistics said yesterday & inflation accelerated for the first time in 5 months. The data underscore risks that full-year growth will slide to the lowest in more than 2 decades, undermining support for the Communist Party before a once-in-a-decade leadership transition due later this year. The rebound in inflation, excess capacity in some industries & banks’ bad debt risks from past monetary easing highlight the potential cost of ramping up stimulus efforts. They have financial problems even though they are far different than those faced in Europe.
China Output Growth Slows as Leadership Handover Looms
Greece's prime minister started a new negotiations with representatives of the its bailout creditors, who are demanding a fresh set of controversial austerity cuts to release the next batch of rescue loans the country desperately needs to stay afloat. Antonis Samaras' meeting with officials from the troika of the EU, IMF & ECB comes a day ahead of his talks in Frankfurt with ECB president Mario Draghi. Troika officials are "evaluating" Greece's proposals for the €11.5B ($14.6B) austerity package for 2013-14, Finance Minister Yannis Stournaras said. "It's a tough discussion, because the measures are tough," he told journalists. Asked whether Greece's creditors are insisting on job cuts in the bloated, inefficient civil service, Stournaras only commented that: "We are trying to convince them that our arguments are correct." In talks with Stournaras yesterday, troika officials rejected part of the Greek proposals. That leaves Samaras battling on 2 fronts: He has to satisfy Greece's creditors, or lose the vital bailout funds, & must also keep the peace with his center-left coalition partners, who publicly reject some of the cutbacks that will cause further widespread pain. Without their support, the gov formed in Jun would collapse, leaving the way open for the radical left main opposition to seize power. The opposition wants Greece to tear up its bailout commitments, even at risk of its leaving the euro. The situation remains fragile.
Greek PM meets austerity inspectors on new cuts AP
Photo: Bloomberg
Hewlett-Packard, the largest PC company in the world & a Dow stock, is planning to cut 2K more jobs than it had previously announced, as CEO Meg Whitman tries to turn the company around. It said it will cut 29K jobs by Oct 2014, up from the 27K cuts announced in May. There was no explanation for the revision. As before, it expects some of the job cuts to come through an early retirement program. HPQ also expects to record charges of $3.7B, mainly for the job cuts, up from the May estimate of $3.5B. Last month, HPQ posted the largest loss in its 73-year history after being hit by the shift in technology spending from PCs & printers towards cellphones & tablets. The stock rose 15¢ but remains near an 8 year low.
HP Says Expands Job Cuts From Reorganizing to 29,000
Stocks are wavering, trying to figure out what to do next. The Chinese data was glum. Its problems of slow growth are difficult to deal with. Then there's Greece which looks like it may not get a passing grade for more bailout money. But much of the attention in NY is on the FOMC meeting at midweek. There is a lot of agreement that the Federal Reserve (FED) will be compelled to do something, but nobody (including FED officials) is clear on what can be done. Markets may drift sideways while waiting to hear from the FED & Dow should remain above 13K.
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month | 0.101% | |
U.S. 2-year | 0.246% | |
U.S. 10-year | 1.659% |
| CLV12.NYM | ....Crude Oil Oct 12 | ...95.73 | ... 0.69 | (0.7%) |
| GCU12.CMX | ...Gold Sep 12 | ...1,731.40 | ... 6.10 | (0.4%) |
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China imports unexpectedly fell & industrial output rose the least in 3 years, signaling more stimulus may be needed after the gov last week said it approved subway & road projects across the nation. Inbound shipments slid 2.6% in Aug from a year earlier as exports rose 2.7%, the customs bureau said. Production increased 8.9%, the National Bureau of Statistics said yesterday & inflation accelerated for the first time in 5 months. The data underscore risks that full-year growth will slide to the lowest in more than 2 decades, undermining support for the Communist Party before a once-in-a-decade leadership transition due later this year. The rebound in inflation, excess capacity in some industries & banks’ bad debt risks from past monetary easing highlight the potential cost of ramping up stimulus efforts. They have financial problems even though they are far different than those faced in Europe.
China Output Growth Slows as Leadership Handover Looms
Greece's prime minister started a new negotiations with representatives of the its bailout creditors, who are demanding a fresh set of controversial austerity cuts to release the next batch of rescue loans the country desperately needs to stay afloat. Antonis Samaras' meeting with officials from the troika of the EU, IMF & ECB comes a day ahead of his talks in Frankfurt with ECB president Mario Draghi. Troika officials are "evaluating" Greece's proposals for the €11.5B ($14.6B) austerity package for 2013-14, Finance Minister Yannis Stournaras said. "It's a tough discussion, because the measures are tough," he told journalists. Asked whether Greece's creditors are insisting on job cuts in the bloated, inefficient civil service, Stournaras only commented that: "We are trying to convince them that our arguments are correct." In talks with Stournaras yesterday, troika officials rejected part of the Greek proposals. That leaves Samaras battling on 2 fronts: He has to satisfy Greece's creditors, or lose the vital bailout funds, & must also keep the peace with his center-left coalition partners, who publicly reject some of the cutbacks that will cause further widespread pain. Without their support, the gov formed in Jun would collapse, leaving the way open for the radical left main opposition to seize power. The opposition wants Greece to tear up its bailout commitments, even at risk of its leaving the euro. The situation remains fragile.
Greek PM meets austerity inspectors on new cuts AP
Hewlett-Packard, the largest PC company in the world & a Dow stock, is planning to cut 2K more jobs than it had previously announced, as CEO Meg Whitman tries to turn the company around. It said it will cut 29K jobs by Oct 2014, up from the 27K cuts announced in May. There was no explanation for the revision. As before, it expects some of the job cuts to come through an early retirement program. HPQ also expects to record charges of $3.7B, mainly for the job cuts, up from the May estimate of $3.5B. Last month, HPQ posted the largest loss in its 73-year history after being hit by the shift in technology spending from PCs & printers towards cellphones & tablets. The stock rose 15¢ but remains near an 8 year low.
HP Says Expands Job Cuts From Reorganizing to 29,000
Hewlett-Packard (HPQ)
Stocks are wavering, trying to figure out what to do next. The Chinese data was glum. Its problems of slow growth are difficult to deal with. Then there's Greece which looks like it may not get a passing grade for more bailout money. But much of the attention in NY is on the FOMC meeting at midweek. There is a lot of agreement that the Federal Reserve (FED) will be compelled to do something, but nobody (including FED officials) is clear on what can be done. Markets may drift sideways while waiting to hear from the FED & Dow should remain above 13K.
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