Dow lost 57, decliners over advancers 4-3 but NAZ rose 9. The MLP index was up 1+ to the 459s & the REIT index fell 1 to the 285s. Junk bond funds were mixed & Treasuries sold off. Oil & gold edged higher.
AMJ (Alerian MLP Index tracking fund)
Photo: Bloomberg
The number of Americans applying for unemployment benefits rose 7K last week to 343K following a drop of 22K the previous week. The broader trend is consistent with an improving job market. The 4-week average fell 1K to 345K according to the Labor Dept. Applications are a proxy for layoffs & they're down nearly 8% this year. Employers have added an average 202K new jobs a month this year, up from an average 183K in 2012. Job growth has been solid despite lackluster economic growth. GDP is expected to show a growth rate of less than 1% in Q2, even worse than an unimpressive 1.8% in Q1. Federal spending cuts that took effect in Mar have hobbled economic growth. More than 4.8M were receiving unemployment benefits, down nearly 20% from 6M a year earlier.
U.S. Jobless Claims Rose Last Week by 7,000 to 343,000
Photo: Bloomberg
A gauge of planned US business spending rose more than expected in Jun & new orders for long-lasting manufactured goods surged, offering tentative signs of a pickup in economic activity. The Commerce Dept said non-defence capital goods orders excluding aircraft increased 0.7% after rising by a revised 2.2% in May. The forecast called for this category to only rise 0.5% after a previously reported 1.5% gain in May. Orders for long-lasting manufactured goods jumped 4.2% as demand for goods ranging from aircraft to machinery improved after increasing a revised 5.2% in May. The forecast was for durable goods to rise only 1.3% after a previously reported 3.7% increase the prior month. The gains in both core capital goods & durable goods orders were consistent with other manufacturing data that have suggested factory activity is regaining some momentum after hitting a soft patch earlier this year. Last month, shipments of core capital goods, used to calculate equipment & software spending in GDP, fell 0.9%, following a 1.9% increase in May & pointed to moderate growth in business spending on capital equipment in Q2.
Orders for U.S. Durable Goods Increase More Than Forecast
3M, a Dividend Aristocrat, net income rose 2.6% in Q2 as revenue grew across most of its businesses & it reaffirmed its full-year guidance. MMM does business all over the world, & its products are used in a wide variety of industries, so its results are watched as an economic barometer. "First-half conditions were challenging, and 3M executed very well under the circumstances," CEO Inga Thule said. "We anticipate demand recovery in the second half of the year, with some help from the macro economy and consumer electronics markets." 3M saw a "continued slow-growth economy" in the second quarter," he said. EPS was $1.71, a penny better than expected. A year ago EPS was $1.66. Revenue rose 2.9% to $7.75B, just slightly less than expectations. Revenue rose in each of its divisions except for its electronics & energy unit, where sales fell 3.2% & profit in that unit fell 16%. "This market continues to seek a bottom, which is impacting our growth," said CFO David Melina. Sales should stabilize in H2, but MMM is aiming to shift resources from wind & solar toward areas that have better growth prospects, Melina said. The stock fell 87¢.
Tech stocks are having a good day, led by Facebook (FB). With a good earnings reports, it shot up 6.61 (25%). But other earnings reports are getting a mixed reception. In addition, some traders may be turning their attention to DC which has been ignored for some time. The gov fiscal year ends Sep 30 & then politicos have to approve funding for the new year. DC remains deeply divided. Raising the debt ceiling (near a staggering $17T) is another required event which has to be dealt with in the next couple of months.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.02% | |
U.S. 2-year |
0.35% | |
U.S. 10-year |
2.61% |
| CLU13.NYM | ...Crude Oil Sep 13 | ...105.12 |  ....0.27 | (0.26%) |
| GCN13.CMX | ...Gold Jul 13 | ........1,323.70 | ...,4.00 (0.3%) |
Photo: Bloomberg
The number of Americans applying for unemployment benefits rose 7K last week to 343K following a drop of 22K the previous week. The broader trend is consistent with an improving job market. The 4-week average fell 1K to 345K according to the Labor Dept. Applications are a proxy for layoffs & they're down nearly 8% this year. Employers have added an average 202K new jobs a month this year, up from an average 183K in 2012. Job growth has been solid despite lackluster economic growth. GDP is expected to show a growth rate of less than 1% in Q2, even worse than an unimpressive 1.8% in Q1. Federal spending cuts that took effect in Mar have hobbled economic growth. More than 4.8M were receiving unemployment benefits, down nearly 20% from 6M a year earlier.
U.S. Jobless Claims Rose Last Week by 7,000 to 343,000
Photo: Bloomberg
A gauge of planned US business spending rose more than expected in Jun & new orders for long-lasting manufactured goods surged, offering tentative signs of a pickup in economic activity. The Commerce Dept said non-defence capital goods orders excluding aircraft increased 0.7% after rising by a revised 2.2% in May. The forecast called for this category to only rise 0.5% after a previously reported 1.5% gain in May. Orders for long-lasting manufactured goods jumped 4.2% as demand for goods ranging from aircraft to machinery improved after increasing a revised 5.2% in May. The forecast was for durable goods to rise only 1.3% after a previously reported 3.7% increase the prior month. The gains in both core capital goods & durable goods orders were consistent with other manufacturing data that have suggested factory activity is regaining some momentum after hitting a soft patch earlier this year. Last month, shipments of core capital goods, used to calculate equipment & software spending in GDP, fell 0.9%, following a 1.9% increase in May & pointed to moderate growth in business spending on capital equipment in Q2.
Orders for U.S. Durable Goods Increase More Than Forecast
3M, a Dividend Aristocrat, net income rose 2.6% in Q2 as revenue grew across most of its businesses & it reaffirmed its full-year guidance. MMM does business all over the world, & its products are used in a wide variety of industries, so its results are watched as an economic barometer. "First-half conditions were challenging, and 3M executed very well under the circumstances," CEO Inga Thule said. "We anticipate demand recovery in the second half of the year, with some help from the macro economy and consumer electronics markets." 3M saw a "continued slow-growth economy" in the second quarter," he said. EPS was $1.71, a penny better than expected. A year ago EPS was $1.66. Revenue rose 2.9% to $7.75B, just slightly less than expectations. Revenue rose in each of its divisions except for its electronics & energy unit, where sales fell 3.2% & profit in that unit fell 16%. "This market continues to seek a bottom, which is impacting our growth," said CFO David Melina. Sales should stabilize in H2, but MMM is aiming to shift resources from wind & solar toward areas that have better growth prospects, Melina said. The stock fell 87¢.
- 3M Posts Slightly Better-Than-Expected 2Q Profit Associated Press
3M (MMM)
Tech stocks are having a good day, led by Facebook (FB). With a good earnings reports, it shot up 6.61 (25%). But other earnings reports are getting a mixed reception. In addition, some traders may be turning their attention to DC which has been ignored for some time. The gov fiscal year ends Sep 30 & then politicos have to approve funding for the new year. DC remains deeply divided. Raising the debt ceiling (near a staggering $17T) is another required event which has to be dealt with in the next couple of months.
Dow Jones Industrials
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