Dow dropped 54, decliners over advancers 2-1 & NAZ was off 11. The MLP index fell 2 to the 454s & the REIT index was off a fraction to the 303s. Junk bond funds rose & Treasuries extend their almost 2 month run, bring the yield on the 10 year Treasury its lowest level in 5 months. There was also selling in oil & gold.
AMJ (Alerian MLP Index tracking fund)
Photo: Bloomberg
Companies added fewer workers than forecast in Apr, an indication the labor market has cooled along with the rest of the US economy. The 119K increase, the smallest since Sep, followed a revised 131K gain in Mar that was smaller than initially estimated, figures from ADP Research Institute. The forecast projected a 150K advance. By hiring fewer employees, companies are signaling they expect demand will deteriorate as reductions in the federal budget & higher taxes weigh on the economic expansion. The Labor Dept report due on Fri is projected to show private payrolls rose by 160K. Goods-producing industries, which include manufacturers & construction companies, expanded by 6K but factory employment dropped 10K. Construction employment climbed 15K. Payrolls at service providers, including professional & business industries, grew 113K. Companies employing more than 499 workers took on 43K workers. Medium-sized businesses, with 50-499 employees, hired 26K, & small companies hired 50K (with lower wages)..
Spending on US construction projects fell in Mar as the biggest drop in gov projects in more than a decade overwhelmed strength in home building. Construction spending fell 1.7% in Mar, compared with Feb, according to the Commerce Dept. It marked the 2nd decline in 3 months. Jan activity plunged a record 4%, which represented a downward revision from a previous estimate of a 2.1% decline. Even with the recent weakness, construction activity was 4.8% higher in Mar than a year ago. Private residential construction rose 0.4%, the only major sector showing a gain. Gov construction activity fell 4.1%, the biggest drop since Mar 2002, while private nonresidential building was down 1.5%. The weakness in gov activity occurred at all levels. Spending by state & local govs was down 4.2% while spending by the federal gov on construction projects was down 1.7%. Federal activity is expected to be reduced in coming months as different agencies cope with across-the-board spending cuts that went into effect on Mar 1. The weakness in nonresidential activity reflected declines in spending on commercial projects such as shopping center. For all 2012, construction spending increased 9.8%, the first annual gain after 5 straight years of declines. But construction spending is still well below healthy levels although housing is helping to support building activity in the face of weakness in gov projects.
US construction spending down 1.7 percent in March AP
Photo: Bloomberg
US manufacturing expanded in Apr at the slowest pace in 4 months, indicating the industry will contribute less to growth in Q2. The Institute for Supply Management factory index fell to 50.7 from the prior month’s 51.3. A reading of 50 is the dividing line between expansion & contraction. The forecast was 50.5. Manufacturing, which makes up about 12% of the economy, is cooling as the need to rebuild inventories wanes & across-the-board federal budget cuts take hold.
Manufacturing in U.S. Expands at Slowest Pace This Year
Stocks started the new month on a negative tone. The first economic reports for the month were just plain gloomy. However the markets are taking this news fairly well, not selling off in a significant way as in the past. Dow remains only a heartbeat away form setting a new record. But the big jobs report for Apr comes out on Fri & that could bring another disappointment.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.048% | |
U.S. 2-year |
0.202% | |
U.S. 10-year |
1.626% |
| CLM13.NYM | ...Crude Oil Jun 13 | ...91.13 |  ....2.33 | (2.5%) |
| GCK13.CMX | ...Gold May 13 | ...1,454.30 | ...17.90 | (1.2%) |
Photo: Bloomberg
Companies added fewer workers than forecast in Apr, an indication the labor market has cooled along with the rest of the US economy. The 119K increase, the smallest since Sep, followed a revised 131K gain in Mar that was smaller than initially estimated, figures from ADP Research Institute. The forecast projected a 150K advance. By hiring fewer employees, companies are signaling they expect demand will deteriorate as reductions in the federal budget & higher taxes weigh on the economic expansion. The Labor Dept report due on Fri is projected to show private payrolls rose by 160K. Goods-producing industries, which include manufacturers & construction companies, expanded by 6K but factory employment dropped 10K. Construction employment climbed 15K. Payrolls at service providers, including professional & business industries, grew 113K. Companies employing more than 499 workers took on 43K workers. Medium-sized businesses, with 50-499 employees, hired 26K, & small companies hired 50K (with lower wages)..
Spending on US construction projects fell in Mar as the biggest drop in gov projects in more than a decade overwhelmed strength in home building. Construction spending fell 1.7% in Mar, compared with Feb, according to the Commerce Dept. It marked the 2nd decline in 3 months. Jan activity plunged a record 4%, which represented a downward revision from a previous estimate of a 2.1% decline. Even with the recent weakness, construction activity was 4.8% higher in Mar than a year ago. Private residential construction rose 0.4%, the only major sector showing a gain. Gov construction activity fell 4.1%, the biggest drop since Mar 2002, while private nonresidential building was down 1.5%. The weakness in gov activity occurred at all levels. Spending by state & local govs was down 4.2% while spending by the federal gov on construction projects was down 1.7%. Federal activity is expected to be reduced in coming months as different agencies cope with across-the-board spending cuts that went into effect on Mar 1. The weakness in nonresidential activity reflected declines in spending on commercial projects such as shopping center. For all 2012, construction spending increased 9.8%, the first annual gain after 5 straight years of declines. But construction spending is still well below healthy levels although housing is helping to support building activity in the face of weakness in gov projects.
US construction spending down 1.7 percent in March AP
Photo: Bloomberg
US manufacturing expanded in Apr at the slowest pace in 4 months, indicating the industry will contribute less to growth in Q2. The Institute for Supply Management factory index fell to 50.7 from the prior month’s 51.3. A reading of 50 is the dividing line between expansion & contraction. The forecast was 50.5. Manufacturing, which makes up about 12% of the economy, is cooling as the need to rebuild inventories wanes & across-the-board federal budget cuts take hold.
Manufacturing in U.S. Expands at Slowest Pace This Year
Stocks started the new month on a negative tone. The first economic reports for the month were just plain gloomy. However the markets are taking this news fairly well, not selling off in a significant way as in the past. Dow remains only a heartbeat away form setting a new record. But the big jobs report for Apr comes out on Fri & that could bring another disappointment.
Dow Jones Industrials
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