Dow was weak at the opening & is currently down 53, decliners over advancers 3-1 & NAZ lost 18. The MLP index fell 2 to the 439s & the REIT index was off 3+ to the 263s. Junk bond funds were lower & Treasuries also pulled back. Oil dropped & gold was flattish.
AMJ (Alerian MLP Index tracking fund)
Photo: Bloomberg
IBM, a Dow stock, continues to face economic challenges as it tries to reignite declining sales, Senior VP Erich Clementi said. Demand for technology services, its biggest source of revenue, “depends on what the economic climate is, and that has not been very encouraging,” Clementi said. “Europe has shown signs of recovery. North America has been a little more uncertain.” Many businesses remain wary about spending money on physical assets, such as computer hardware, machinery or warehouses. Instead, they’re using software & cloud-computing services to increase efficiency & reach more customers over the internet. While IBM ultimately expects to benefit from that shift to the cloud, the hardware slump has contributed to 6 straight qtrs of declining revenue. “The big bet is on cloud and the software that are on top,” Clementi said. SoftLayer Technologies, a cloud-computing storage provider that IBM acquired in Jul, will help the company compete with rivals, he said. IBM sales slid 4% last qtr from a year-earlier period & IBM also posted its first-ever revenue decrease in traditional growth markets in the period, with sales in China tumbling more than 20%. Even so, the company is still targeting EPS of $20 in 2015. To help reach that goal, IBM will continue its shift into higher-margin business & focus on cloud computing, Clementi said. The stock lost 70¢.
IBM Says Economy Remains Discouraging
MasterCard rose the most since Aug after announcing an 83% dividend increase & a 10-for-1 stock split. The quarterly dividend was increased to $1.10 & MA will repurchase up to $3.5B of stock. The share buyback program takes effect after the firm’s current $2B plan, previously announced, is complete. MA has returned more than 1600% including divs since its May 2006 IPO, dwarfing the 66 % total return for the S&P 500. The stock leaped 34 to a new record
MasterCard Climbs Most Since August on Dividend: New York Mover
The gut reaction to the budget deal was negative. There are also concerns that it won't be approved with something in there to upset just about everybody. But that's how compromises work. Yield sensitive securities sold off as they have been doing since the May peak. Dow is off 170 in Dec.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.07% | |
U.S. 2-year |
0.30% | |
U.S. 10-year |
2.82% |
| CLF14.NYM | ...Crude Oil Jan 14 | ...97.98 |  ...0.53 | (0.5%) |
| GCZ13.CMX | ...Gold Dec 13 | ....1,260.30 | ...2.10 | (0.2%) |
Photo: Bloomberg
House & Senate negotiators, in a rare bipartisan act, announced a
budget agreement designed to avert another
gov shutdown & bring a dose of stability to fiscal policy-making over the next 2 years. Sen. Patty Murray &
Rep. Paul Ryan said it would allow more spending for domestic & defense
programs in the near term, while adopting deficit-reduction measures
over a decade to offset the costs. Revenues to fund the
higher spending would come from changes to federal employee & military
pension programs, & higher fees for airline passengers, among other
sources. An extension of long-term jobless benefits, sought by
Dems, wasn't included. The plan is modest in scope, compared
with past budget deals. But in a year & an institution characterized by gridlock, politicos were relieved they could reach even a minimal
agreement. The deal, which
goes to the House & Senate for approval in the coming days, marks a
major change in the landmark 2011 budget-cutting law, which set in
motion 10 years of fiscal austerity, including across-the-board spending
cuts (sequestration). The
annual discretionary spending target will be raised to $1.012T
in 2014 & $1.014T in 2015 under the accord.
IBM, a Dow stock, continues to face economic challenges as it tries to reignite declining sales, Senior VP Erich Clementi said. Demand for technology services, its biggest source of revenue, “depends on what the economic climate is, and that has not been very encouraging,” Clementi said. “Europe has shown signs of recovery. North America has been a little more uncertain.” Many businesses remain wary about spending money on physical assets, such as computer hardware, machinery or warehouses. Instead, they’re using software & cloud-computing services to increase efficiency & reach more customers over the internet. While IBM ultimately expects to benefit from that shift to the cloud, the hardware slump has contributed to 6 straight qtrs of declining revenue. “The big bet is on cloud and the software that are on top,” Clementi said. SoftLayer Technologies, a cloud-computing storage provider that IBM acquired in Jul, will help the company compete with rivals, he said. IBM sales slid 4% last qtr from a year-earlier period & IBM also posted its first-ever revenue decrease in traditional growth markets in the period, with sales in China tumbling more than 20%. Even so, the company is still targeting EPS of $20 in 2015. To help reach that goal, IBM will continue its shift into higher-margin business & focus on cloud computing, Clementi said. The stock lost 70¢.
IBM Says Economy Remains Discouraging
International Business Machines (IBM)
MasterCard rose the most since Aug after announcing an 83% dividend increase & a 10-for-1 stock split. The quarterly dividend was increased to $1.10 & MA will repurchase up to $3.5B of stock. The share buyback program takes effect after the firm’s current $2B plan, previously announced, is complete. MA has returned more than 1600% including divs since its May 2006 IPO, dwarfing the 66 % total return for the S&P 500. The stock leaped 34 to a new record
MasterCard Climbs Most Since August on Dividend: New York Mover
Mastercard (MA)
The gut reaction to the budget deal was negative. There are also concerns that it won't be approved with something in there to upset just about everybody. But that's how compromises work. Yield sensitive securities sold off as they have been doing since the May peak. Dow is off 170 in Dec.
Dow Jones Industrials
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