Thursday, December 13, 2012

Markets fluctate after November retail sales

Dow slid 27, decliners over advancers 5-4 & NAZ fell 6.  Banks stock remain strong with the Financial Index falling only a fraction in the 216s.  The MLP Index fell another 2 to 380 & the REIT index lost 1 to 262.  The MLP index is at its lowest point since Nov 19.  Junk bond funds were mixed as were Treasuries, although the 10 year bond lost ground.  Oil fluctuated & gold went back below $1700.

AMJ (Alerian MLP Index tracking fund)

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Treasury yields:

U.S. 3-month


U.S. 2-year


U.S. 10-year


CLF13.NYM...Crude Oil Jan 13...86.26 .....Down 0.51  (0.6%)

GCZ12.CMX...Gold Dec 12....1,694.70 ...Down 21.90  (1.3%)

  • <p>               In this  Friday, Dec. 7, 2012, photo, a help wanted sign is posted on the front window of a clothing boutique in Los Angeles.The number of Americans seeking unemployment benefits fell sharply for a fourth straight week, a sign that the job market may be improving. The Labor Department said Thursday, Dec. 13, 2012, that weekly applications for unemployment benefits fell 29,000 last week to a seasonally adjusted 343,000, the lowest in two months. It is the second-lowest total this year.  (AP Photo/Damian Dovarganes)
Photo:   Yahoo

The number of Americans seeking unemployment benefits fell sharply for a 4rth straight week.  The Labor Dept said that weekly applications for unemployment benefits fell 29K to 343K, the lowest in 2 months & the 2nd-lowest total this year.  The drop suggests that companies aren't laying off workers in advance of the "fiscal cliff."  Applications spiked 5 weeks ago because of Superstorm Sandy.  But the storm's impact has faded.  The 4-week average fell 27K to 381K.  Before the storm, applications had fluctuated between 360K- 390K.  The storm had little effect on overall hiring in Nov.  The total number receiving benefits rose to 5.6M, nearly 700K more than in the previous week. 

Jobless Claims in U.S. Decline to a Nine-Week Low

Luxembourg Prime Minister Jean-Claude Juncker

Photo:   Bloomberg

Euro govs geared up to provide extra aid or debt relief for Greece after releasing the country’s first loan payment in 6 months, signaling renewed battles over how to stabilize the euro economy.  The ministers approved the payout of €49.1B ($64B) of loans through Mar & committed to "additional measures" in case Greece’s debt reduction veers off track.  While another cut in bailout-loan rates & an increase in infrastructure funding would top the list of extra measures, the policy makers hinted that outright debt relief, still a taboo topic in creditor countries led by Germany, would be on the table as well.  “Other tools are possible and it doesn’t make any sense to be more precise on these possible tools,” Luxembourg Prime Minister Jeasn-Claude Juncker said.  Greece will get €34.3B in coming days, covering €16B for bank recapitalization, €7B for the gov budget & €11.3B to finance a bond buyback that was used to retire debt.  Another €14.8B will flow in Q1 of 2013 as long as Greece meets conditions to be agreed on with creditors.

Greek Aid Payments Approved by Euro Finance Ministers

  • <p>               FILE - In this Thursday, Nov. 22, 2012, file photo, a customer makes a purchase in the Times Square Toys-R-Us store in New York. U.S. retail sales rose 0.3 percent in November from October, the Commerce Department said Thursday. That offset a 0.3 percent decline in October from September. (AP Photo/John Minchillo, File)
Photo:   Yahoo

Americans spent more online in Nov to start the holiday season & began to replace cars & rebuild in the Northeast after Superstorm Sandy.  Retail sales rose 0.3% from Oct, according to the Commerce Dept.  That offset a 0.3% decline in Oct from Sep.  The figures were much stronger after factoring lower gas prices. When excluding a large drop in gas station sales, retail sales increased a solid 0.8%.  The report offered a mixed signal for the holiday shopping season.  Sales that reflect online shopping surged 3%, the biggest gain in 13 months.  But department store sales tumbled as less was spent less at stores.  Some of the decline may be because of the storm.  However there are worries that consumers may also be growing more cautious because of looming tax increases set to take effect in Jan.  Sandy slowed business activity during the first couple of weeks of Nov, the start of the busiest shopping period of the year.  The retail sales report largely reflected a rebound from the storm.  Auto sales jumped 1.5%, as many sought to replace damaged vehicles.  Sales at home improvement stores increased 1.6%.  Some figures suggest shoppers regained their enthusiasm for the holidays, perhaps later in the month.  Electronic & appliance sales rose 2.5% & furniture sales increased 1%.  Still, department stores sales dropped 0.8% & sales at general merchandise stores fell 0.9%.

Retail Sales Climb as Americans Snap Up Autos, Electronics

Stocks are meandering again after economic data was uninspiring.  Greece keeps bumbling along with little decided longer term.  REITs have been going sideways for most of the year, but MLPs have had tougher sledding.  The MLP index is down 10 YTD.  Buyers have to worry about how changes in tax law might affect their tax advantage status.  The energy business is strong in the US & that could make them a target for higher taxes when politicos make their changes.

Dow Jones Industrials

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