Dow moved up 15, decliners ahead of advancers 5-4 & NAZ added 15. The Financial Index was flattish at 213. The MLP index was up pennies to 386 & the REIT index gained 1+ to the 261s. Junk bond funds were mixed & Treasuries continued strong, bringing yields to 4 month lows. Oil dropped to a 1-week low after the ECB cut its euro-area growth
forecasts & gold was also weak.
Photo: Bloomberg
The number of people seeking US unemployment aid fell sharply last week as a temporary spike caused by Superstorm Sandy has faded & applications have fallen back to a level consistent with modest hiring. The Labor Dept said that applications dropped 25K to 370K. Applications spiked a month ago after Sandy shuttered businesses in the Northeast, jumping to 451K 4 weeks ago. There is encouragement on by how quickly applications have returned to pre-storm levels. But the early impact of Sandy can still be seen in the 4-week average which rose to 408K. Before the storm hit, applications had fluctuated this year between 360K-390K after topping 400K for most of last year. That coincided with only modest declines in the unemployment rate.
Jobless Claims in U.S. Decline as Sandy Effect Wanes
Photo: Yanoo
The ECB underlined the gloomy prospects for the economy of the EU, cutting its forecast for growth next year to minus 0.3% from plus 0.5%. Even so, the bank left rates unchanged & Mario Draghi gave little sign the bank was willing to add more stimulus. He said the bank had already done much to lower borrowing costs in heavily indebted countries that are struggling to grow. The governing council kept the refinancing rate unchanged at 0.75 %. Draghi said current rates were "very accomodative," meaning they are low enough to encourage growth. He also said that the ECB had already effectively lowered some interest rates with its plan announced in Sep to buy the bonds of indebted countries. That plan had led to a drop of as much as 2-2½ percentage points in some countries borrowing costs, just on anticipation by bond investors. "That is much more than you can achieve by a cut in the policy rate," Draghi said. The eurozone's economy is in recession, having shrunk 0.1% in Q3 after a 0.2% fall in Q2. It is expected to contract again in Q4. Draghi said the slump would continue into next year, with a gradual recovery later in 2013. The bank's minus 0.3% outlook is the midpoint of the forecast rate of between minus 0.9% & plus 0.3%. Growth is being held back across the eurozone as govs slash spending & raise taxes to try to reduce levels of debt piled up from overspending in the case of Greece or real estate bubbles & banking crises in Spain & Ireland. Greece, Portugal, Ireland & Cyprus have already needed bailouts, while Italy & Spain, the 3rd & 4th-largest economies, teetered on the edge of needing help this summer.
Draghi Leaves Rate-Cut Door Ajar as ECB Reduces Forecasts
Photo: Bloomberg
Apple stock is trying to halt its decline after China Mobile CEO Li Yue said he wouldn’t add the iPhone to the world’s largest wireless network without a deal that's favorable for his company. “The business model and benefit sharing still need further discussion,” Li said. Technical issues related to the carrier’s homegrown 3rd-generation network standard would also need to be resolved, Li said. The iPhone isn’t available to most users in China as AAPL has yet to reach an agreement with China Mobile (which had 703M subscribers at the end of Oct, including 79M users of high- speed, 3rd-generation services that give smartphones faster internet access). The iPhone is available with the nation’s 2 smaller carriers: China Unicom & China Telecom, both of which sell it with a subsidy. The new iPhone 5 will begin sales with those carriers next week. While AAPL stock was up pocket change, it's a down a whopping 165 from its peak when it introduced the new iPhone in late Sep.
Apple Drops as China Mobile CEO Says IPhone Faces Hurdles
Markets continue to stumble along looking for direction. They are getting none from DC, as the pres is getting ready for a Hawaii vacation which will add $40M to the federal deficit. This is not a positive signal that could signal he was serious about making a deal to reduce the deficit. Once again, tomorrow's problems will taken take of themselves tomorrow. The forecast for the euro economy is depressing although many of those stocks are at 18 month highs. Stocks are not deeply disturbed as Dow is holding above 13K.
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.086% | |
U.S. 2-year |
0.234% | |
U.S. 10-year |
1.574% |
| CLF13.NYM | ...Crude Oil Jan 13 | ...86.50 | ... 1.38 | (1.6%) |
| GCZ12.CMX | ...Gold Dec 12 | ....1,687.30 | ... 5.10 | (0.3%) |
Photo: Bloomberg
The number of people seeking US unemployment aid fell sharply last week as a temporary spike caused by Superstorm Sandy has faded & applications have fallen back to a level consistent with modest hiring. The Labor Dept said that applications dropped 25K to 370K. Applications spiked a month ago after Sandy shuttered businesses in the Northeast, jumping to 451K 4 weeks ago. There is encouragement on by how quickly applications have returned to pre-storm levels. But the early impact of Sandy can still be seen in the 4-week average which rose to 408K. Before the storm hit, applications had fluctuated this year between 360K-390K after topping 400K for most of last year. That coincided with only modest declines in the unemployment rate.
Jobless Claims in U.S. Decline as Sandy Effect Wanes
The ECB underlined the gloomy prospects for the economy of the EU, cutting its forecast for growth next year to minus 0.3% from plus 0.5%. Even so, the bank left rates unchanged & Mario Draghi gave little sign the bank was willing to add more stimulus. He said the bank had already done much to lower borrowing costs in heavily indebted countries that are struggling to grow. The governing council kept the refinancing rate unchanged at 0.75 %. Draghi said current rates were "very accomodative," meaning they are low enough to encourage growth. He also said that the ECB had already effectively lowered some interest rates with its plan announced in Sep to buy the bonds of indebted countries. That plan had led to a drop of as much as 2-2½ percentage points in some countries borrowing costs, just on anticipation by bond investors. "That is much more than you can achieve by a cut in the policy rate," Draghi said. The eurozone's economy is in recession, having shrunk 0.1% in Q3 after a 0.2% fall in Q2. It is expected to contract again in Q4. Draghi said the slump would continue into next year, with a gradual recovery later in 2013. The bank's minus 0.3% outlook is the midpoint of the forecast rate of between minus 0.9% & plus 0.3%. Growth is being held back across the eurozone as govs slash spending & raise taxes to try to reduce levels of debt piled up from overspending in the case of Greece or real estate bubbles & banking crises in Spain & Ireland. Greece, Portugal, Ireland & Cyprus have already needed bailouts, while Italy & Spain, the 3rd & 4th-largest economies, teetered on the edge of needing help this summer.
Draghi Leaves Rate-Cut Door Ajar as ECB Reduces Forecasts
Photo: Bloomberg
Apple stock is trying to halt its decline after China Mobile CEO Li Yue said he wouldn’t add the iPhone to the world’s largest wireless network without a deal that's favorable for his company. “The business model and benefit sharing still need further discussion,” Li said. Technical issues related to the carrier’s homegrown 3rd-generation network standard would also need to be resolved, Li said. The iPhone isn’t available to most users in China as AAPL has yet to reach an agreement with China Mobile (which had 703M subscribers at the end of Oct, including 79M users of high- speed, 3rd-generation services that give smartphones faster internet access). The iPhone is available with the nation’s 2 smaller carriers: China Unicom & China Telecom, both of which sell it with a subsidy. The new iPhone 5 will begin sales with those carriers next week. While AAPL stock was up pocket change, it's a down a whopping 165 from its peak when it introduced the new iPhone in late Sep.
Apple Drops as China Mobile CEO Says IPhone Faces Hurdles
Apple (AAPL)
Markets continue to stumble along looking for direction. They are getting none from DC, as the pres is getting ready for a Hawaii vacation which will add $40M to the federal deficit. This is not a positive signal that could signal he was serious about making a deal to reduce the deficit. Once again, tomorrow's problems will taken take of themselves tomorrow. The forecast for the euro economy is depressing although many of those stocks are at 18 month highs. Stocks are not deeply disturbed as Dow is holding above 13K.
Dow Jones Industrials
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