Dow rebounded with a 69 gain, advancers over decliners 5-2 & NAZ added 18. The Financial Index gained 1+ to the 246s. The MLP index rose 2 to the 433s & the REIT index was up 1 to 282. Junk bond funds went up & Treasuries pulled back in the rising stock market. Oil was up with the rising stock market & gold slid back.
AMJ (Alerian MLP Index tracking fund)
Photo: Yahoo
Cyprus officials rushed to find a new plan to stave off bankruptcy, a day after Parliament rejected an initial scheme to contribute to the nation's bailout package by seizing up to 10% of people's bank savings. Rejection of the plan to take a slice of all deposits above €20K ($26K) has left the country's bailout in question. Without the bailout, the Cypriot banking sector would collapse, devastating the country's economy & potentially causing it to leave the euro which could roil global financial markets as well as endanger deposits in the country even further. A gov spokesman said a meeting was underway at the central bank to discuss an alternative plan for raising funds, but also for reducing the €5.8B ($7.5B) that must be found domestically. President Anastasiades met with the representatives of his country's potential creditors, the IMF, ECB & European Commission, but issued no statement. The 3 must sign off on any Plan B the Cypriots come up with if it is to be approved as part of the bailout. The ECB, which is keeping the Cypriot banking sector alive by allowing the local central bank to extend emergency support, has said it would end that aid if there was no bailout deal & it was clear the banks had no hope of becoming solvent again. There are hopes Russia (with a lot at stake) will be a white knight but the situation doesn't look good.
Congress is pressing to avoid a gov shutdown with a Senate vote this week on a stopgap funding bill for the rest of the fiscal year, as lawmakers from both parties set battle lines over the 2014 budget. Congressional leaders say they want to prevent even a partial halt of gov operations by getting the stopgap measure to the pres before Mar 27 (one week away) when the law keeping agencies’ lights on will expire. House Budget Committee Chairman Paul Ryan said yesterday that he expects his colleagues to accept the Dem measure as-is. “As long as they hit the numbers, we’re good to go,” Ryan said on Bloomberg Television. “I have every reason to believe that that’s the case.” Approving the measure, known as a continuing resolution, also would clear the way for debate in the House & Senate over their 2014 budget plans. House Reps today will start debating Ryan’s latest budget offering, which proposes to balance the gov books within a decade solely thru spending cuts. Senate Dems can’t take up a competing plan, which outlines a combination of tax increases & spending cuts, until work on the continuing resolution is done. This is huge & as usual, the final outcome will come at the last minute.
Senate Nears Passage of Bill to Avert Federal Shutdown
Photo: Yahoo
FedEx cut full-year forecast after a worse-than-expected quarterly profit as customers shift from air express to slower but cheaper modes of intl shipping. The express unit, its biggest source of revenue, has also been hit by overcapacity in the industry that has squeezed margins. Operating income in the express unit fell 66%. FedEx said the express unit underperformed due to weakness in Asia & other intl markets, where margin pressures arising from excess capacity more than offset increased volumes. "We have a yield issue that exaggerated itself this quarter over last quarter," Dave Bronczek, CEO of FedEx Express said. FDX plans to cut express capacity to & from Asia from Apr 1 & is looking at reducing its fleet by retiring more of its older, less-efficient aircraft. FDX, considered an economic bellwether because of the massive volume of goods it moves, forecast fiscal Q4 adjusted EPS of $1.90-$2.10 which compares with the analysts forecast of $2.07. The company now expects EPS of $6.00-$6.20 for fiscal 2013. It had earlier forecast $6.20-$6.60 & analysts are expecting EPS of $6.31. Q3 EPS was $1.13 & excluding items, EPS was $1.23. Revenue rose 4% to $11B. Analysts expect EPS of $1.38 on revenue of $10.8B. The stock sank 5.79.
FedEx Cuts 2013 Forecast Amid Plans to Trim Asia Capacity
The stock market views any kind of news as good (assuming it's not truly horrible). There are hopes that some kind of bailout for Cyprus will make that problem go away. DC is trying to get its house in order by passing funding for the balance of the fiscal year. Then they have to address the bigger problem of deciding on next year's budget. That battle will get bloody because Reps don't want tax hikes & Dems love them. Meanwhile the report from FDX sends an ominous message about the state of business around the world. But stocks are not listening.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.074% | |
U.S. 2-year |
0.248% | |
U.S. 10-year |
1.946% |
| CLJ13.NYM | ....Crude Oil Apr 13 | ...93.10 | ... 0.94 | (1.0%) |
| GCH13.CMX | ...Gold Mar 13 | ...1,612.50 | ... 1.20 | (0.1%) |
Photo: Yahoo
Cyprus officials rushed to find a new plan to stave off bankruptcy, a day after Parliament rejected an initial scheme to contribute to the nation's bailout package by seizing up to 10% of people's bank savings. Rejection of the plan to take a slice of all deposits above €20K ($26K) has left the country's bailout in question. Without the bailout, the Cypriot banking sector would collapse, devastating the country's economy & potentially causing it to leave the euro which could roil global financial markets as well as endanger deposits in the country even further. A gov spokesman said a meeting was underway at the central bank to discuss an alternative plan for raising funds, but also for reducing the €5.8B ($7.5B) that must be found domestically. President Anastasiades met with the representatives of his country's potential creditors, the IMF, ECB & European Commission, but issued no statement. The 3 must sign off on any Plan B the Cypriots come up with if it is to be approved as part of the bailout. The ECB, which is keeping the Cypriot banking sector alive by allowing the local central bank to extend emergency support, has said it would end that aid if there was no bailout deal & it was clear the banks had no hope of becoming solvent again. There are hopes Russia (with a lot at stake) will be a white knight but the situation doesn't look good.
Congress is pressing to avoid a gov shutdown with a Senate vote this week on a stopgap funding bill for the rest of the fiscal year, as lawmakers from both parties set battle lines over the 2014 budget. Congressional leaders say they want to prevent even a partial halt of gov operations by getting the stopgap measure to the pres before Mar 27 (one week away) when the law keeping agencies’ lights on will expire. House Budget Committee Chairman Paul Ryan said yesterday that he expects his colleagues to accept the Dem measure as-is. “As long as they hit the numbers, we’re good to go,” Ryan said on Bloomberg Television. “I have every reason to believe that that’s the case.” Approving the measure, known as a continuing resolution, also would clear the way for debate in the House & Senate over their 2014 budget plans. House Reps today will start debating Ryan’s latest budget offering, which proposes to balance the gov books within a decade solely thru spending cuts. Senate Dems can’t take up a competing plan, which outlines a combination of tax increases & spending cuts, until work on the continuing resolution is done. This is huge & as usual, the final outcome will come at the last minute.
Senate Nears Passage of Bill to Avert Federal Shutdown
Photo: Yahoo
FedEx cut full-year forecast after a worse-than-expected quarterly profit as customers shift from air express to slower but cheaper modes of intl shipping. The express unit, its biggest source of revenue, has also been hit by overcapacity in the industry that has squeezed margins. Operating income in the express unit fell 66%. FedEx said the express unit underperformed due to weakness in Asia & other intl markets, where margin pressures arising from excess capacity more than offset increased volumes. "We have a yield issue that exaggerated itself this quarter over last quarter," Dave Bronczek, CEO of FedEx Express said. FDX plans to cut express capacity to & from Asia from Apr 1 & is looking at reducing its fleet by retiring more of its older, less-efficient aircraft. FDX, considered an economic bellwether because of the massive volume of goods it moves, forecast fiscal Q4 adjusted EPS of $1.90-$2.10 which compares with the analysts forecast of $2.07. The company now expects EPS of $6.00-$6.20 for fiscal 2013. It had earlier forecast $6.20-$6.60 & analysts are expecting EPS of $6.31. Q3 EPS was $1.13 & excluding items, EPS was $1.23. Revenue rose 4% to $11B. Analysts expect EPS of $1.38 on revenue of $10.8B. The stock sank 5.79.
FedEx Cuts 2013 Forecast Amid Plans to Trim Asia Capacity
FedEx (FDX)
The stock market views any kind of news as good (assuming it's not truly horrible). There are hopes that some kind of bailout for Cyprus will make that problem go away. DC is trying to get its house in order by passing funding for the balance of the fiscal year. Then they have to address the bigger problem of deciding on next year's budget. That battle will get bloody because Reps don't want tax hikes & Dems love them. Meanwhile the report from FDX sends an ominous message about the state of business around the world. But stocks are not listening.
Dow Jones Industrials
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