Dow jumped 95, advancers just ahead of decliners & NAZ gained 20. The MLP index was off 1 to 451 & the REIT index fell 3+ to below 281. Junk bond funds were weak & Treasuries sold off. Oil was up fractionally & gold retreated.
AMJ (Alerian MLP Index tracking fund)
Photo: Bloomberg
US economic growth unexpectedly accelerated in Q2, laying a firmer foundation for the rest of the year that could bring the Federal Reserve a step closer to cutting back its monetary stimulus. GDP grew at a 1.7% annual rate, according to the Commerce Dept, stepping up from the Q1 downwardly revised 1.1% expansion pace. Economists forecasted the economy grew at a 1.0% pace after a previously reported 1.8% advance in Q1. A rebound in business spending, export growth & a sharp moderation in the pace of decline in gov outlays boosted economic growth, offsetting a slowdown in consumer spending & a steady rate of inventory accumulation. Still, the report marked a 3rd straight quarter of GDP growth below 2%, a pace that normally would be too soft to bring down unemployment. But growth was poised to gain even more momentum in H2 as the fiscal burden brought on by DC belt-tightening eases. The FOMC is looking at this data at their meeting today.
Economy in U.S. Expands More Than Forecast on Inventories
Photo: Yahoo
US private employers added 200K jobs in Jul, topping expectations in an encouraging sign for the labor market recovery. Economists had forecasted the ADP National Employment Report would show a gain of 180K jobs. Private payrolls in Jun were revised up to an increase of 198K from the previously reported 188K. The report is jointly developed with Moody's Analytics. Manufacturers, construction companies & other goods-producing industries increased payrolls by 22K. Construction employment grew by 22K & factory payrolls decreased by 5K while payrolls at service providers climbed 177K (lower paying jobs). Companies employing 500 or more workers added 57K jobs. Employment at businesses with 50-499 employees increased 60K & the smallest companies boosted payrolls by 82K.
Companies in U.S. Added More Workers in July Than Forecast
Photo: Yahoo
IMF praise for Greece despite $14bn cash gap Associated Press
Buyers returned after the news was good on the economic front. Of course that same news could give the FOMC encouragement to more forward on paring its bond buying program. With the Dow at another record level, a lot of good news has already been baked into this market. This reminds me of the old adage, buy on the rumor & sell on the news (later today when the announcement from the meeting is made).
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury Yields:
U.S. 3-month |
0.04% | |
U.S. 2-year |
0.33% | |
U.S. 10-year |
2.67% |
| CLU13.NYM | ....Crude Oil Sep 13 | ...103.32 |  ....0.24 | (0.2%) |
| GCQ13.CMX | ...Gold Aug 13 | .......1,313.40 | ...10.60 | (0.8%) |
Photo: Bloomberg
US economic growth unexpectedly accelerated in Q2, laying a firmer foundation for the rest of the year that could bring the Federal Reserve a step closer to cutting back its monetary stimulus. GDP grew at a 1.7% annual rate, according to the Commerce Dept, stepping up from the Q1 downwardly revised 1.1% expansion pace. Economists forecasted the economy grew at a 1.0% pace after a previously reported 1.8% advance in Q1. A rebound in business spending, export growth & a sharp moderation in the pace of decline in gov outlays boosted economic growth, offsetting a slowdown in consumer spending & a steady rate of inventory accumulation. Still, the report marked a 3rd straight quarter of GDP growth below 2%, a pace that normally would be too soft to bring down unemployment. But growth was poised to gain even more momentum in H2 as the fiscal burden brought on by DC belt-tightening eases. The FOMC is looking at this data at their meeting today.
Economy in U.S. Expands More Than Forecast on Inventories
Photo: Yahoo
US private employers added 200K jobs in Jul, topping expectations in an encouraging sign for the labor market recovery. Economists had forecasted the ADP National Employment Report would show a gain of 180K jobs. Private payrolls in Jun were revised up to an increase of 198K from the previously reported 188K. The report is jointly developed with Moody's Analytics. Manufacturers, construction companies & other goods-producing industries increased payrolls by 22K. Construction employment grew by 22K & factory payrolls decreased by 5K while payrolls at service providers climbed 177K (lower paying jobs). Companies employing 500 or more workers added 57K jobs. Employment at businesses with 50-499 employees increased 60K & the smallest companies boosted payrolls by 82K.
Companies in U.S. Added More Workers in July Than Forecast
Photo: Yahoo
The IMF said Greece had made "exceptional"
progress in stabilizing its economy & remains on course to emerge from
a near 6-year recession in 2014, despite missing targets to cut state
jobs & the threat of an €11B ($14.6B) gap in bailout
financing. Its report also cautioned that Greece needs to make major structural
reforms so its economy can grow in the long-term. Greece's coalition gov is struggling to meet staff reduction
targets in the large public sector, & is due to announce details later today of its plan to suspend up to 25K employees on reduced pay
by the end of the year. The IMF described the country's privatization program as being
"painfully slow" & expressed concern that mass staff transfers &
layoffs planned in the public sector may not have the desired effect. "The (IMF) is concerned that the focus is shifting significantly away
from ensuring the exit of redundant and unqualified staff to relocation
of such staff within the public sector," it said. Poul Thomsen, the IMF's mission chief in Greece, said he was
confident the recession would end soon & that eurozone countries would
make good on their pledge to provide Greece with additional debt relief
after Athens balances its state budget. The IMF also predicted the
bailout program would fall short of Greece's needs by €4.4B
($5.8B) next year & €6.5B ($8.6B) in
2015.
IMF praise for Greece despite $14bn cash gap Associated Press
Buyers returned after the news was good on the economic front. Of course that same news could give the FOMC encouragement to more forward on paring its bond buying program. With the Dow at another record level, a lot of good news has already been baked into this market. This reminds me of the old adage, buy on the rumor & sell on the news (later today when the announcement from the meeting is made).
Dow Jones Industrials
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