Monday, November 11, 2013

Dow creeps higher to a new record close

Dow was up 21, advancers barely ahead of decliners & NAZ added all of 1.  The MLP index fell 2+ to 447 & the REIT index gained pennies in the 269s.  Junk bond funds were mixed & Treasuries had the day off.  Oil went up after talks with Iran about its nuclear program went nowhere & gold eased back fractionally.

AMJ (Alerian MLP Index tracking fund)

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Crude Oil Dec 13 ....94.76 ...+0.16   +0.17%

Live 24 hours gold chart [Kitco Inc.]

China's passenger-vehicle sales climbed last month the most since Jan, helped by a recovery in economic growth & rebound in demand for Japanese brands.  Wholesale deliveries of cars, multipurpose & sport utility vehicles rose 24% to 1.6M, according to the state-backed China Association of Automobile Manufacturers today.  That compares with the estimate of 1.5M units.  The fastest pace of auto sales in 9 months adds to signs that China’s economy is gaining momentum going into Q4, with official statistics released last week showing industrial production & customs data rose more than forecast while manufacturing investment strengthened.  Vehicle demand  surged last month as anti-Japanese sentiment over a territorial dispute abated.  Total sales of vehicles, including buses & trucks, rose 20% to 1.93M, the association said.  YTD, 17.8M vehicles were delivered, which included 14.5M automobiles.  Commercial vehicles sales increased 7.4% in the first 10 months of the year to 3.36M units.

China Auto Sales Climb at Fastest Pace in Nine Months

River in Wuhan

Photo:    Bloomberg

China's economy entered Q4 with an acceleration in manufacturing & exports, momentum that offered confidence to Communist leaders gathering to determine policy shifts for the coming decade.  Industrial output rose a more-than-estimated 10.3% from a year earlier in Oct & manufacturing investment strengthened.  Customs data showed overseas sales rebounded by more than forecast.  President Xi Jinping & top leaders tomorrow conclude a 4-day gathering to map out an economic blueprint to sustain growth & drive the urbanization of hundreds of millions of rural residents.  Chinese media reported on the prospects for allowing private investment in gov businesses & for expanding a property tax nationwide as the People’s Daily said the party needs to demonstrate the “ability to govern.”  Standard Chartered last month raised its estimate for China’s 2013 economic growth to 7.6% from 7.5% & revised next year’s forecast to 7.4% from 7.2%.  About 370 top Communist Party members including gov ministers, military officers & heads of state-owned companies are gathering in Beijing for a meeting known as the 3rd plenum to decide on the scale & pace of changes in the economy.  A communique will be released after the meeting ends outlining the road-map.

China Economic Rebound Gives Boost to Communist Leaders Amid Reform Summit

Federal prosecutors want Bank of America to pay $864M over losses incurred by the gov after it bought thousands of home loans made by Countrywide Financial during the housing boom.  US Attorney Preet Bharara made the request late Fri with the US District Court in Manhattan.  A jury in Oct found BAC liable for knowingly selling thousands of bad home loans to Fannie Mae & Freddie Mac in 2007-2008.  The trial related to mortgages the gov said were sold at breakneck speed without regard to quality as the economy headed into a tailspin.  The gov accused the financial institutions of urging workers to churn out loans, accept fudged applications & hide ballooning defaults through a loan program called the Hustle, shorthand for high-speed swim lane, which operated under the motto, "Loans move forward, never backward."  BAC denies there was fraud.  Thousands of loans made through the Hustle program were sold to Fannie & Freddie, which packaged loans into securities & sold them to investors.  The companies were effectively nationalized in 2008, when they nearly collapsed from mortgage losses.  In the filing, Bharara asked the court to make the penalty on BAC equal to the maximum losses racked up from the Hustle program by the gov-run mortgage buyers.  BAC said that it will respond to the penalty filing before a Nov 20 deadline.  The stock was up pennies.

Feds seek $864M from BofA over Countrywide loans

Bank of America (BAC)

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This was a very quiet day on low volume, little was decided.  Dow managed to eke out a new record close, but it did not stray far from breakeven.  On low volume that is not saying much.  Tomorrow the traders will be back in full force.

Dow Jones Industrials

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