Dow inched up 2, advancers ahead of decliners 5-4 & NAZ rose 7. The MLP index edged up a fraction to 462 & the REIT index was pretty much even in the 292s. Junk bond funds slid lower & Treasuries went up. Oil was about even, but gold finally found buyers as it went over 1300.
AMJ (Alerian MLP Index tracking fund)
Photo: Yahoo
McDonald's, a Dow stock & Dividend Aristocrat, is mixing up its menu with healthier, fresher sounding items such as its chicken McWraps, but not enough customers are biting. In Q2, profits rose 4% but fell short of expectations. It also said Jul sales are expected to be relatively flat & warned of a tough year ahead. The company says global sales edged up 1% at restaurants open at least a year during Q2. The figure rose by the same amount in the US, where the company has been touting its Dollar Menu & trying to adapt to changing eating habits with items such as its veggie-filled chicken wraps & egg-white breakfast sandwiches. But the tepid growth in the latest quarter reflects the challenges for MCD, which for years had been a standout in the fast-food industry. Part of the problem is that economic conditions remain weak in many parts of the world. But another factor is that dining habits are changing, particularly in the US, with people increasingly opting for foods they feel are fresher, healthier or higher-quality. Looking ahead, MCD said its initiatives in the US are "designed to satisfy evolving customer expectations." CEO Don Thompson said that the company has a bigger product pipeline than in the past & MCD can capitalize on ideas from around the world & adapt them to other markets. In Q1, the company reported its first global quarterly sales decline at restaurants open at least 13 months. For Q2, the company said sales were down 0.1% in Europe as results in Germany & France dragged down results from the UK & Russia. In Asia, the Middle East & Africa, sales also dipped 0.3%, primarily because of negative results in China, Australia & Japan. In Q2, EPS was $1.38, up from $1.32 last year & short of the $1.40 expected. The stock fell 2.65.
McDonald’s Falls as Profit Trails Estimates
Sales of previously owned houses unexpectedly dropped in Jun, hurt by a lack of supply & rising mortgage rates. Purchases fell 1.2% to a 5.08M annualized rate, the National Association of Realtors reported. The forecast called for a 5.26M pace. But the pace of the demand was the 2nd strongest since Nov 2009 following May’s downwardly revised 5.14M rate. The number of houses for sale at the end of last month was the fewest in 12 yerars as rising prices depleted the number of cheaper houses on the market. The median price of an existing home climbed 13.5% to $214K last month from $188K a year earlier. The number of properties on the market increased 1.9% to 2.19M, the fewest for any Jun since 2001. At the current sales pace, it would take 5.2 months to sell those houses compared with 5 months at the end of May.
Sales of Existing Homes in U.S. Unexpectedly Decline
The Bundesbank said the German economy, Europe’s largest, is set to slow after a rebound in Q2. “Signs of a slowdown in economic growth are increasing” in line with expectations, the central bank said in its monthly report. “The assessment that the German economy expanded strongly in the second quarter after a weather-related weak start to 2013 is being confirmed by current indicators. Important contributions to growth in the second quarter should come from industry and construction.” While the Ifo institute’s measure of German business confidence increased for a 2nd month in Jun & unemployment unexpectedly declined, factory orders, industrial production & exports slumped in May. Germany's overseas sales are being curbed as the euro region, its biggest trading partner, struggles to emerge from recession & growth slows in China, its 3rd-biggest export destination. The Bundesbank last month lowered its growth projection for 2013 to 0.3% from 0.4%, & cut its 2014 outlook to 1.5% from 1.9%. The economy expanded just 0.1% in Q1.
Bundesbank Says German Growth Slows After Strong Second Quarter
During earnings season, Dow has been going higher. But its average daily gain has been a meager 12. Earnings are coming in OK, but shorty of great. The story is similar to prior quarters, profits are higher largely from accounting adjustments while revenue has been flattish. Q2 will be a continuation of the unusually slow recovery from the 2009 recession & economies around the world are sputtering. But so far the stock market has not been deeply disturbed.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.02% | |
U.S. 2-year |
0.30% | |
U.S. 10-year |
2.47% |
| CLQ13.NYM | ...Crude Oil Aug 13 | ...107.99 |  ......0.06 | (0.1%) |
| GCN13.CMX | ...Gold Jul 13 | .........1,322.30 | ...29.00 | (2.2%) |
Photo: Yahoo
McDonald's, a Dow stock & Dividend Aristocrat, is mixing up its menu with healthier, fresher sounding items such as its chicken McWraps, but not enough customers are biting. In Q2, profits rose 4% but fell short of expectations. It also said Jul sales are expected to be relatively flat & warned of a tough year ahead. The company says global sales edged up 1% at restaurants open at least a year during Q2. The figure rose by the same amount in the US, where the company has been touting its Dollar Menu & trying to adapt to changing eating habits with items such as its veggie-filled chicken wraps & egg-white breakfast sandwiches. But the tepid growth in the latest quarter reflects the challenges for MCD, which for years had been a standout in the fast-food industry. Part of the problem is that economic conditions remain weak in many parts of the world. But another factor is that dining habits are changing, particularly in the US, with people increasingly opting for foods they feel are fresher, healthier or higher-quality. Looking ahead, MCD said its initiatives in the US are "designed to satisfy evolving customer expectations." CEO Don Thompson said that the company has a bigger product pipeline than in the past & MCD can capitalize on ideas from around the world & adapt them to other markets. In Q1, the company reported its first global quarterly sales decline at restaurants open at least 13 months. For Q2, the company said sales were down 0.1% in Europe as results in Germany & France dragged down results from the UK & Russia. In Asia, the Middle East & Africa, sales also dipped 0.3%, primarily because of negative results in China, Australia & Japan. In Q2, EPS was $1.38, up from $1.32 last year & short of the $1.40 expected. The stock fell 2.65.
McDonald’s Falls as Profit Trails Estimates
McDonald's (MCD)
Sales of previously owned houses unexpectedly dropped in Jun, hurt by a lack of supply & rising mortgage rates. Purchases fell 1.2% to a 5.08M annualized rate, the National Association of Realtors reported. The forecast called for a 5.26M pace. But the pace of the demand was the 2nd strongest since Nov 2009 following May’s downwardly revised 5.14M rate. The number of houses for sale at the end of last month was the fewest in 12 yerars as rising prices depleted the number of cheaper houses on the market. The median price of an existing home climbed 13.5% to $214K last month from $188K a year earlier. The number of properties on the market increased 1.9% to 2.19M, the fewest for any Jun since 2001. At the current sales pace, it would take 5.2 months to sell those houses compared with 5 months at the end of May.
Sales of Existing Homes in U.S. Unexpectedly Decline
The Bundesbank said the German economy, Europe’s largest, is set to slow after a rebound in Q2. “Signs of a slowdown in economic growth are increasing” in line with expectations, the central bank said in its monthly report. “The assessment that the German economy expanded strongly in the second quarter after a weather-related weak start to 2013 is being confirmed by current indicators. Important contributions to growth in the second quarter should come from industry and construction.” While the Ifo institute’s measure of German business confidence increased for a 2nd month in Jun & unemployment unexpectedly declined, factory orders, industrial production & exports slumped in May. Germany's overseas sales are being curbed as the euro region, its biggest trading partner, struggles to emerge from recession & growth slows in China, its 3rd-biggest export destination. The Bundesbank last month lowered its growth projection for 2013 to 0.3% from 0.4%, & cut its 2014 outlook to 1.5% from 1.9%. The economy expanded just 0.1% in Q1.
Bundesbank Says German Growth Slows After Strong Second Quarter
During earnings season, Dow has been going higher. But its average daily gain has been a meager 12. Earnings are coming in OK, but shorty of great. The story is similar to prior quarters, profits are higher largely from accounting adjustments while revenue has been flattish. Q2 will be a continuation of the unusually slow recovery from the 2009 recession & economies around the world are sputtering. But so far the stock market has not been deeply disturbed.
Dow Jones Industrials
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