Thursday, September 12, 2013

Markets meander amid the Syrian mess

Dow inched up pocket change, decliners just ahead of advancers & NAZ gained 3.  The MLP index was up fractionally to 442 & the REIT index slipped a fraction in the 268s.  Junk bond funds were lower & Treasuries finally rallied.  The commodity quotes below are not current.  But oil slid lower & gold had a small decline.

AMJ (Alerian MLP Index tracking fund)

stock chart

Treasury yields:

U.S. 3-month


U.S. 2-year


U.S. 10-year


CLV13.NYM....Crude Oil Oct 13...107.31 Down ...0.08  (0.1%)

GCU13.CMX...Gold Sep 13.......1,363.20 Down ....0.90  

Job seekers attend a career fair at Rutgers University in New Brunswick, New Jersey, January 6, 2011. REUTERS/Mike Segar

Photo:   Yahoo

The number of new US jobless claims fell sharply last week but much of the decline appeared due to technical problems in claims processing, clouding the last reading of labor market health before the FMOC meets to consider reducing its stimulus for the economy.  Initial claims for state unemployment benefits slipped 31K to 292K, according to the Labor Dept.  That was the lowest level of claims since 2006, confounding expectations for a mild increase.  A dept analyst said the majority of the decline appeared to be because 2 states were upgrading their computer systems & did not process all the claims they received during the week.  This decline is highly unusual, & the analyst declined to say which 2 states reported problems (one of them was a large state & the other small).  It was likely that the unprocessed claims would appear in the following week's data, he said.  Also potentially clouding last week's claims data, most offices & work sites were closed for the Mon holiday.  While the drop in claims should be taken with a grain of salt, it doesn't change the view that employers appear to have ended a long cycle of elevated layoffs that began around the 2007-09 recession.  The 4-week moving average for new claims had in prior weeks already fallen to its lowest levels since 2007.  Last week, it fell by 7K to 321K.

Initial Jobless Claims Slump as Two U.S. States Underreport

Obama's Own Words on Syria Chemical Arms, Diplomacy

Photo:   Bloomberg

Obama’s relationship with Congress over Syria  marked a notable departure, consultation instead of confrontation.  It didn’t last long.  When he announced on Sep 10 that he was asking Congress to postpone the vote to authorize military action against Syria, it was the first time the 2 top House Rep leaders had been told of this shift (even though they’d backed his unpopular proposal).  The lack of official notice ahead of the speech was a sign that after the brief moment of unity, acrimony between the 2 sides was back in session.  And it comes at a perilous time, as the administration & Reps need to come to an agreement to avoid a gov shutdown after the 2013 budget year that ends on Sep 30.  The House plans to be in session only 6 working days before the deadline, & already Boehner & Cantor have delayed a vote on a spending proposal amid opposition by fellow Reps who want the party to take a tougher stand against funding Obama’s health-care law.  Along with grappling with the 2014 budget, within weeks both sides also will need to find a way to stave off a possible gov default as the nation reaches its borrowing limits.  Obama also needs to woo Rep support for Senate confirmation of his eventual pick to lead the Federal Reserve, a process that could begin as early as this month.  There's a lot going on (or maybe not going on) in DC.

Obama Syria Reversal Sets Stage for Fights With Congress

Foreclosure filings fell 34% in the US last month as first-time defaults dropped to the lowest level in almost 8 years & rising home prices made it easier for distressed owners to sell, RealtyTrac said.  Default, auction & repossession filings totaled 128K in Aug, with one in 1019 US households receiving a notice.  It was the 35th consecutive month in which total notices declined on an annual basis, with foreclosure starts plunging 44%.  “The foreclosure floodwaters have receded in most parts of the country, but lenders and communities continue to clean up the damage left behind,” RealtyTrac VP Daren Blomquist said.  Increasing buyer demand & climbing property values are helping some troubled borrowers refinance or sell rather than lose their homes to foreclosure.  The S&P/Case-Shiller index of property values in 20 cities rose 12.1% in Jun from a year earlier.  Last month, foreclosure starts totaled 55K, the lowest since Dec 2005, & fell on a year-over-year basis in 38 states, RealtyTrac said.  Bank seizures rose 6% last month from Jul, the 3rd increase in 4 months, “a trend that will likely continue into next year,” Blomquist said.

U.S. Foreclosure Filings Decrease 34% as Property Prices Climb

Stocks are looking for direction after Dow is up an amazing 520 this month.  There has no special news to support the rally.  Maybe traders coming back from holiday see value.  The Syrian situation is a confusing mess that is nowhere near being resolved.  Then DC has a lot on its plate, between funding the gov next year (which will add to the Treasury debt) & then rasing the debt ceiling.

Dow Jones Industrials

stock chart

No comments: