Dow rose 95, advancers ahead of decliners 3-2 & NAZ gained 20. The Financial Index climbed 2+ to 215. The MLP index was up a fraction into the 408s & the REIT index rose 2+ to 264. Junk bond funds rose & Treasuries were little changed. Buying of oil in the PM brought it back to only a modest loss. But the price of gold is at the lowest level in about a month after new
Chinese data renewed questions about whether its leaders will implement
additional measures to get revive economic growth.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Bloomberg
Citigroup shot up the most among the largest US banks, reaching a 6 month high after reporting a surprise Q3 profit & a surge in bond- trading revenue that beat estimates. EPS excluding one-time items & a $582M tax benefit was $1.06, beating the 97¢ estimate. CEO Pandit is cutting jobs & disposing of unwanted assets, including a 49% stake in Smith Barney, as he seeks to return capital to shareholders & complies with new regulations on buffers against losses. Revenue from fixed-income trading surged 63% excluding accounting adjustments after tumbling last year during the European sovereign-debt crisis. EPS was 15¢, down from $1.23, a year earlier. Including one-time items, estimates are that Citi would post a loss of $777M. Revenue excluding a Smith Barney writedown & accounting adjustments rose 3% to $19.4B & expenses declined 2% to $12.2B. The stock rose $1.94, almost 6%.
Photo: Bloomberg
China's inflation was close to the slowest pace in 2 years in Sep, giving the gov room to ease policies should the economy deteriorate. Consumer prices rose 1.9% from a year earlier while the producer-price index dropped 3.6% according to the National Bureau of Statistics. Imports increased 2.4% from a year earlier while overseas shipments climbed 9.9%, the customs administration said on Sat. A report this week may show the nation’s expansion slid to 7.4% in Q3 from a year earlier, the 7th straight deceleration, underscoring IMF warnings that weakening growth in developed economies are spreading to emerging markets. At the same time, there are signs the economy is stabilizing after exports exceeded estimates in September & money supply grew at the fastest pace in 15 months. China has refrained from implementing stimulus on the scale of the 4T yuan ($586 B at the time) package it unleashed at the end of 2008 during the global financial crisis, confining its response to measures such as 2 cuts in interest rates, reductions in bank reserve requirements, tax decreases, higher spending on social welfare & accelerated investment approvals. At an IMF meeting in Tokyo over the weekend, People’s Bank of China Deputy Governor Yi Gang said that while policy makers will provide “appropriate” stimulus to stabilize growth, the central bank’s main task is price stability & warned that bubble risks remain in housing markets in major cities. China’s Xinhua News Agency cited Yi as saying that the nation has “relatively large room” for use of monetary & fiscal policies compared with some countries.
China Inflation Cools Amid Signs of Stable Economy Growth
Photo: Bloomberg
More than 3 years into a recovery from the worst financial crisis in decades, Americans finally are getting their finances back into shape. Federal Reserve figures show. household debt as a share of disposable income sank to 113% in Q2 from a record high of 134% in 2007 before the recession hit. Debt payments on that basis are the smallest in almost 18 years, while the delinquency rate for credit cards si the lowest since the end of 2008. The progress that consumers have been making should allow GDP to absorb stepped-up deficit reduction by the federal gov next year & keep on expanding. GDP could grow at 2.1% in 2013, slightly above this year’s projected 2.2% (assuming Congress allows some, but not all, of the scheduled year-end tax increases & spending cuts to go ahead). In a sign of consumer resilience, retail sales rose 1.1% last month after advancing 1.2% in Aug, the biggest back-to-back monthly increase since late 2010. Automobile companies also stand to benefit as consumers become more willing to buy cars using credit. Then there's the unknown of how hard the fiscal cliff will bite.
Consumers Paying Down Debt Helps Boost U.S. Expansion
While the markets had a good day, breadth was weak. Mighty Apple (AAPL) has been a market leader in recent months, but was up only a modest 4 even though it's bringing out a new iPad. Markets are nervous. Dow has slipped back to where it was 3 weeks ago, not good as earnings season begins.
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.097% | |
U.S. 2-year |
0.258% | |
U.S. 10-year |
1.659% |
| CLX12.NYM | ...Crude Oil Nov 12 | ...91.70 | ... 0.16 | (0.2%) |
Photo: Bloomberg
Citigroup shot up the most among the largest US banks, reaching a 6 month high after reporting a surprise Q3 profit & a surge in bond- trading revenue that beat estimates. EPS excluding one-time items & a $582M tax benefit was $1.06, beating the 97¢ estimate. CEO Pandit is cutting jobs & disposing of unwanted assets, including a 49% stake in Smith Barney, as he seeks to return capital to shareholders & complies with new regulations on buffers against losses. Revenue from fixed-income trading surged 63% excluding accounting adjustments after tumbling last year during the European sovereign-debt crisis. EPS was 15¢, down from $1.23, a year earlier. Including one-time items, estimates are that Citi would post a loss of $777M. Revenue excluding a Smith Barney writedown & accounting adjustments rose 3% to $19.4B & expenses declined 2% to $12.2B. The stock rose $1.94, almost 6%.
Citigroup (C)
China's inflation was close to the slowest pace in 2 years in Sep, giving the gov room to ease policies should the economy deteriorate. Consumer prices rose 1.9% from a year earlier while the producer-price index dropped 3.6% according to the National Bureau of Statistics. Imports increased 2.4% from a year earlier while overseas shipments climbed 9.9%, the customs administration said on Sat. A report this week may show the nation’s expansion slid to 7.4% in Q3 from a year earlier, the 7th straight deceleration, underscoring IMF warnings that weakening growth in developed economies are spreading to emerging markets. At the same time, there are signs the economy is stabilizing after exports exceeded estimates in September & money supply grew at the fastest pace in 15 months. China has refrained from implementing stimulus on the scale of the 4T yuan ($586 B at the time) package it unleashed at the end of 2008 during the global financial crisis, confining its response to measures such as 2 cuts in interest rates, reductions in bank reserve requirements, tax decreases, higher spending on social welfare & accelerated investment approvals. At an IMF meeting in Tokyo over the weekend, People’s Bank of China Deputy Governor Yi Gang said that while policy makers will provide “appropriate” stimulus to stabilize growth, the central bank’s main task is price stability & warned that bubble risks remain in housing markets in major cities. China’s Xinhua News Agency cited Yi as saying that the nation has “relatively large room” for use of monetary & fiscal policies compared with some countries.
China Inflation Cools Amid Signs of Stable Economy Growth
Photo: Bloomberg
More than 3 years into a recovery from the worst financial crisis in decades, Americans finally are getting their finances back into shape. Federal Reserve figures show. household debt as a share of disposable income sank to 113% in Q2 from a record high of 134% in 2007 before the recession hit. Debt payments on that basis are the smallest in almost 18 years, while the delinquency rate for credit cards si the lowest since the end of 2008. The progress that consumers have been making should allow GDP to absorb stepped-up deficit reduction by the federal gov next year & keep on expanding. GDP could grow at 2.1% in 2013, slightly above this year’s projected 2.2% (assuming Congress allows some, but not all, of the scheduled year-end tax increases & spending cuts to go ahead). In a sign of consumer resilience, retail sales rose 1.1% last month after advancing 1.2% in Aug, the biggest back-to-back monthly increase since late 2010. Automobile companies also stand to benefit as consumers become more willing to buy cars using credit. Then there's the unknown of how hard the fiscal cliff will bite.
Consumers Paying Down Debt Helps Boost U.S. Expansion
While the markets had a good day, breadth was weak. Mighty Apple (AAPL) has been a market leader in recent months, but was up only a modest 4 even though it's bringing out a new iPad. Markets are nervous. Dow has slipped back to where it was 3 weeks ago, not good as earnings season begins.
Dow Jones Industrials
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