Dow dropped 55, decliners over advancers 4-3 & NAZ was off 13. The MLP index slipped a fraction to the 454s & the REIT index lost 1+ to 266. Junk bond funds were higher & Treasuries also advanced. Oil & gold were steady at multi month lows.
AMJ (Alerian MLP Index tracking)
Applications for unemployment benefits fell last week to the lowest in a month as improvements in the economy prompted employers to retain workers. Jobless claims declined by 15K to 330K according to the Labor Dept. The forecast projected 335K. Data can be volatile after the holidays as temporary workers are dismissed. Companies typically let go of temporary staff after the holidays, which means claims may see-saw thru Jan. The 4 week average dropped to 349K from 358K. The number continuing to receive jobless benefits climbed 50K to 2.87M in the latest week. The unemployment rate among people eligible for benefits held at 2.2%, where it’s been since early Dec. 29 states & territories reported an increase in claims, while 24 reported a decrease..
Jobless Claims in U.S. Decrease to Lowest Level in a Month
Janet Yellen, confirmed this week by the Senate to succeed Big Ben as Federal Reserve (FED) chairman, said that the US economy will accelerate this year & more employment opportunities may follow. “I think we’ll see stronger growth this year,” Yellen said. “Most of my colleagues on the Fed’s policy making committee and I are hopeful that the first digit” of gross domestic product “could be 3 rather than 2.” She added that “the recovery has been frustratingly slow, but we’re making progress in getting people back to work, and I anticipate that inflation will move back toward our longer-run goal of 2 percent.” The FED took the first step toward the exit last month when it announced plans to reduce the monthly pace of asset purchases to $75B, citing evidence of improvement in the labor market. She pushed back at suggestions that the asset purchases are “just helping the rich.” “It’s not true. Our policy is aimed at holding down long-term interest rates, which supports the recovery by encouraging spending.” Part of the stimulus “comes through higher house and stock prices, which causes people with homes and stocks to spend more, which causes jobs to be created throughout the economy and income to go up through the economy.” Yellen said that her first priority, when she replaces Big Ben after his term ends Jan 31, is reducing joblessness. “I’d like to see real wages going up,” she added.
Yellen Says U.S. Economy May Strengthen This Year, Time Reports
Retailers of all stripes are providing hard evidence that the discount war that marked the holiday season will take a toll on profit. L Brands (LB), which owns the Victoria’s Secret & Bath & Body Works brands, & Family Dollar (FDO) today cut profit forecasts after reporting disappointing Dec sales as promotions that failed to lure shoppers hurt profit margins. Pier One (PIR) cut its Q4 forecast after Dec sales trailed its expectations. Early results are showing that the discounts, as steep as 75%, didn’t generate sufficient traffic or spur enough purchases of full-priced merchandise to make up for the lost revenue. LB said that it reduced its forecast because merchandise margins were lower than expected amid promotions & Q4 EPS will be about $1.60, down from a previous forecast of at least $1.67. Analysts projected $1.79. Sales at stores open at least a year at the retailer’s Victoria’s Secret brand rose 3% in Dec, trailing the 4.4% estimate. Shares in their stocks fell 5-12% today.
Retailers Cut Forecasts as December Discounts Hurt Profitability
Stocks are receiving a less than warm reception in the new year. The retail sales reports will be repeated by other chains, calling into question the strength in the economy. But high yield debt & Treasuries found a few buyers today. Dow is down 176 in the new year, not serious but an interruption after an unusually good year in 2013.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking)
Treasury yields:
U.S. 3-month |
0.04% | |
U.S. 2-year |
0.43% | |
U.S. 10-year |
2.98% |
| CLF15.NYM | ...Crude Oil Jan 15 | ...87.48 |  ...0.07 | (0.1%) |
| GCF14.CMX | ...Gold Jan 14 | .....1,229.00 | ...3.70 | (0.3%) |
Applications for unemployment benefits fell last week to the lowest in a month as improvements in the economy prompted employers to retain workers. Jobless claims declined by 15K to 330K according to the Labor Dept. The forecast projected 335K. Data can be volatile after the holidays as temporary workers are dismissed. Companies typically let go of temporary staff after the holidays, which means claims may see-saw thru Jan. The 4 week average dropped to 349K from 358K. The number continuing to receive jobless benefits climbed 50K to 2.87M in the latest week. The unemployment rate among people eligible for benefits held at 2.2%, where it’s been since early Dec. 29 states & territories reported an increase in claims, while 24 reported a decrease..
Jobless Claims in U.S. Decrease to Lowest Level in a Month
Janet Yellen, confirmed this week by the Senate to succeed Big Ben as Federal Reserve (FED) chairman, said that the US economy will accelerate this year & more employment opportunities may follow. “I think we’ll see stronger growth this year,” Yellen said. “Most of my colleagues on the Fed’s policy making committee and I are hopeful that the first digit” of gross domestic product “could be 3 rather than 2.” She added that “the recovery has been frustratingly slow, but we’re making progress in getting people back to work, and I anticipate that inflation will move back toward our longer-run goal of 2 percent.” The FED took the first step toward the exit last month when it announced plans to reduce the monthly pace of asset purchases to $75B, citing evidence of improvement in the labor market. She pushed back at suggestions that the asset purchases are “just helping the rich.” “It’s not true. Our policy is aimed at holding down long-term interest rates, which supports the recovery by encouraging spending.” Part of the stimulus “comes through higher house and stock prices, which causes people with homes and stocks to spend more, which causes jobs to be created throughout the economy and income to go up through the economy.” Yellen said that her first priority, when she replaces Big Ben after his term ends Jan 31, is reducing joblessness. “I’d like to see real wages going up,” she added.
Yellen Says U.S. Economy May Strengthen This Year, Time Reports
Retailers of all stripes are providing hard evidence that the discount war that marked the holiday season will take a toll on profit. L Brands (LB), which owns the Victoria’s Secret & Bath & Body Works brands, & Family Dollar (FDO) today cut profit forecasts after reporting disappointing Dec sales as promotions that failed to lure shoppers hurt profit margins. Pier One (PIR) cut its Q4 forecast after Dec sales trailed its expectations. Early results are showing that the discounts, as steep as 75%, didn’t generate sufficient traffic or spur enough purchases of full-priced merchandise to make up for the lost revenue. LB said that it reduced its forecast because merchandise margins were lower than expected amid promotions & Q4 EPS will be about $1.60, down from a previous forecast of at least $1.67. Analysts projected $1.79. Sales at stores open at least a year at the retailer’s Victoria’s Secret brand rose 3% in Dec, trailing the 4.4% estimate. Shares in their stocks fell 5-12% today.
Retailers Cut Forecasts as December Discounts Hurt Profitability
Stocks are receiving a less than warm reception in the new year. The retail sales reports will be repeated by other chains, calling into question the strength in the economy. But high yield debt & Treasuries found a few buyers today. Dow is down 176 in the new year, not serious but an interruption after an unusually good year in 2013.
Dow Jones Industrials
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