Dow dropped 29, advancers over decliners 3-2 & NAZ climbed 7. The MLP index jumped 4 to the 467s, flirting with a new record high, & the REIT went up 2 to 280. Junk bond funds edged higher & Treasuries pulled back. Oil pared gains after the
US Energy Information Administration said stockpiles increased
more than expected last week. Gold was flattish.
AMJ (Alerian MLP Index tracking fund)
5 years into the economic recovery, inflation shows little sign of picking up as prices rise more slowly for goods & services, complicating the Federal Reserve’s (FED) drive to guide the economy away from the precipice of deflation. The personal consumption expenditures price index, minus food & energy costs, rose 1.2% in 2013, matching 2009 as the smallest gain since 1955. Of 27 categories of goods & services, 18 showed smaller price increases over the past 2 years. The slowdown has been broad-based, with durable goods such as autos, nondurables like clothing & services including health care all playing a role. Policy makers are on guard to keep such disinflation from morphing into outright deflation, a persistent drop in prices that prompts households to delay purchases in anticipation of even lower costs & leads companies to postpone investment & hiring. Investors predict subdued prices. The 5 year breakeven rate, a market gauge of inflation expectations over the next 5 years based on trading in inflation-linked Treasuries, was at 1.94% yesterday, down from 2.3% last year at this time. Tame inflation will allow the FED to keep interest rates lower for longer as they try to nudge price increases closer to their goal of 2% a year. A 1.2% year-over-year rise in the core PCE price index in Dec compares with a 1.9% gain in 2011. The 0.7 percentage-point decline is almost evenly spread among the 3 main categories, with nondurable goods making up 0.3 percentage point of the slowdown & services & durable goods each contributing 0.2 percentage point.
Baby Clothes to Cars Broaden Price Slowdown Trying Fed: Economy
Procter & Gamble, a Dow stock & Dividend Aristocrat, lowered its forecast for profit & sales growth this year because of currency exchange-rate fluctuations & policy changes in Venezuela. Core EPS, which excludes some restructuring charges, will increase 3-5% this year, down from a previous forecast of 5-7%. Revaluing some portions of its business in Venezuela at the gov-set exchange rate will result in a charge of as much as 10¢ per share. When it reported earnings last month, PG said it expected “no further currency weakness within our guidance range,” even as markets were experiencing the biggest sell-off in emerging-market currencies in 5 years because of economic instability & the effect of the FED (tapering of monetary stimulus. But it said that events in markets such as Venezuela & Egypt could put that outlook at risk. It has been estimated that about 2% of sales come from Venezuela. The stock lost 71¢.
If you would like to learn more about PG, click on this link:
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.05% | |
U.S. 2-year |
0.34% | |
U.S. 10-year |
2.75% |
| CLH14.NYM | ,,,Crude Oil Mar 14 | ...101.08 |  ...1.14 | (1.1%) |
| GCG14.CMX | ...Gold Feb 14 | ........1,289.10 | ...1.00 | (0.1%) |
5 years into the economic recovery, inflation shows little sign of picking up as prices rise more slowly for goods & services, complicating the Federal Reserve’s (FED) drive to guide the economy away from the precipice of deflation. The personal consumption expenditures price index, minus food & energy costs, rose 1.2% in 2013, matching 2009 as the smallest gain since 1955. Of 27 categories of goods & services, 18 showed smaller price increases over the past 2 years. The slowdown has been broad-based, with durable goods such as autos, nondurables like clothing & services including health care all playing a role. Policy makers are on guard to keep such disinflation from morphing into outright deflation, a persistent drop in prices that prompts households to delay purchases in anticipation of even lower costs & leads companies to postpone investment & hiring. Investors predict subdued prices. The 5 year breakeven rate, a market gauge of inflation expectations over the next 5 years based on trading in inflation-linked Treasuries, was at 1.94% yesterday, down from 2.3% last year at this time. Tame inflation will allow the FED to keep interest rates lower for longer as they try to nudge price increases closer to their goal of 2% a year. A 1.2% year-over-year rise in the core PCE price index in Dec compares with a 1.9% gain in 2011. The 0.7 percentage-point decline is almost evenly spread among the 3 main categories, with nondurable goods making up 0.3 percentage point of the slowdown & services & durable goods each contributing 0.2 percentage point.
Baby Clothes to Cars Broaden Price Slowdown Trying Fed: Economy
Procter & Gamble, a Dow stock & Dividend Aristocrat, lowered its forecast for profit & sales growth this year because of currency exchange-rate fluctuations & policy changes in Venezuela. Core EPS, which excludes some restructuring charges, will increase 3-5% this year, down from a previous forecast of 5-7%. Revaluing some portions of its business in Venezuela at the gov-set exchange rate will result in a charge of as much as 10¢ per share. When it reported earnings last month, PG said it expected “no further currency weakness within our guidance range,” even as markets were experiencing the biggest sell-off in emerging-market currencies in 5 years because of economic instability & the effect of the FED (tapering of monetary stimulus. But it said that events in markets such as Venezuela & Egypt could put that outlook at risk. It has been estimated that about 2% of sales come from Venezuela. The stock lost 71¢.
If you would like to learn more about PG, click on this link:
club.ino.com/trend/analysis/stock/PG?a_aid=CD3289&a_bid=6ae5b6f7
Procter & Gamble Cuts Profit Forecast on Currency Effects
Home Depot, a Dow stock, plans to add the same number of part-time workers for its busiest sales season as it did in 2013, capitalizing on rising demand for home renovations. More than 80K seasonal employees will be hired to prepare for the spring, when Americans traditionally spend more to fix up their homes, Tim Crow, executive VP of human resources said, matching the company’s seasonal hires for last year & 2012. “Spring is our Christmas,” Crow said. “After a winter like we’re having this year, everyone will be excited to get outdoors.” HD is adding workers as it benefits from surging home values in the past 2 years that have encouraged owners to spend on their properties. Sales gained 9.4% to $79.4B in the 12 months thru Nov 3. Thousands of the seasonal hires are likely to stay beyond the spring after about half were promoted to permanent positions last year, he said. The chain has 340K employees. The stock went up a dime.
If you would like to learn more about HD, click on this link:
club.ino.com/trend/analysis/stock/HD?a_aid=CD3289&a_bid=6ae5b6f7
Home Depot Plans to Hire Same Amount of Seasonal Workers
Stocks want to make it 4 straight days of higher markets, but are struggling with a lack of significant good news. Even after that mini rally, Dow is down 600 YTD, not a good performance when so many had high expectations. Yield sensitive stocks have been doing well & the Alerian MLP Index is knocking on the door of a new record. Not too many securities can make that claim. In the middle of the crappy weather in DC, politicos will try to come up with legislation to raise the federal debt ceiling.
Dow Jones Industrials
Procter & Gamble Cuts Profit Forecast on Currency Effects
Procter & Gamble (PG)
Home Depot, a Dow stock, plans to add the same number of part-time workers for its busiest sales season as it did in 2013, capitalizing on rising demand for home renovations. More than 80K seasonal employees will be hired to prepare for the spring, when Americans traditionally spend more to fix up their homes, Tim Crow, executive VP of human resources said, matching the company’s seasonal hires for last year & 2012. “Spring is our Christmas,” Crow said. “After a winter like we’re having this year, everyone will be excited to get outdoors.” HD is adding workers as it benefits from surging home values in the past 2 years that have encouraged owners to spend on their properties. Sales gained 9.4% to $79.4B in the 12 months thru Nov 3. Thousands of the seasonal hires are likely to stay beyond the spring after about half were promoted to permanent positions last year, he said. The chain has 340K employees. The stock went up a dime.
If you would like to learn more about HD, click on this link:
club.ino.com/trend/analysis/stock/HD?a_aid=CD3289&a_bid=6ae5b6f7
Home Depot Plans to Hire Same Amount of Seasonal Workers
Home Depot (HD)
Stocks want to make it 4 straight days of higher markets, but are struggling with a lack of significant good news. Even after that mini rally, Dow is down 600 YTD, not a good performance when so many had high expectations. Yield sensitive stocks have been doing well & the Alerian MLP Index is knocking on the door of a new record. Not too many securities can make that claim. In the middle of the crappy weather in DC, politicos will try to come up with legislation to raise the federal debt ceiling.
Dow Jones Industrials
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