Dow lost 31, advancers barely ahead of decliners & NAZ slid back 1. The MLP index rose 3+ to the 498s & the REIT index added a fraction in the 301s. Junk bond funds went up & Treasuries advancers bringing yields near the lowest levels in more than a year. Oil & gold were little changed.
AMJ (Alerian MLP Index tracking fund)
Fewer Americans filed applications for unemployment benefits last week, sending the average over the past month to an 8-year low, a sign the labor market continues to gain momentum. Jobless claims decreased 14K to 289K from 303K in the prior period, according to the Labor Dept. The forecast called for an increase to 304K. Companies are holding on to more workers in an effort to keep up with increased orders & stronger consumer demand, contributing to a virtuous cycle of growth as the economy accelerates. Fewer layoffs & more jobs would support further gains in incomes & household spending, which accounts for 70% of the economy. The 4 week average dropped to 293K, the lowest since Feb 2006, from 297K the week before. The number continuing to receive jobless benefits declined 24K to 2.52M. In that same period, the unemployment rate among people eligible for benefits held at 1.9%.
Jobless Claims Fall as Average Drops to Eight-Year Low
ECB pres Mario Draghii said the risks to the recovery from conflicts including that in Ukraine are increasing. “Heightened geopolitical risks, as well as developments in emerging-market economies and global financial markets, may have the potential to affect economic conditions negatively,” Draghi said after the ECB kept its main interest rates unchanged. “We are strongly determined to safeguard the firm anchoring of inflation expectations over the medium to long term.” Headwinds facing the recovery in the 18-nation euro area are intensifying, after Italy slipped back into recession & the standoff between Russia versus the US & allies. Draghi has in the past said an external shock to the economy that endangers the inflation outlook could be a trigger for broad-based asset purchases, or quantitative easing. “The Governing Council is unanimous in its commitment to use unconventional policy measures like ABS purchases, like QE, if our medium-term outlook for inflation were to change,” Draghi said. “We will closely monitor the possible repercussions of heightened geopolitical risks and exchange-rate developments.” Russia slapped import bans on an array of food goods from the US & Europe today, striking back at sanctions over the conflict in Ukraine. The curbs target nations that have imposed or supported sanctions against Russia & also include Canada, Australia & Norway. “There is no doubt that if you look at the world today, you’ll see that geopolitical risks have increased all over the world: we have the Russian-Ukrainian crisis, Iraq, Gaza, Syria, and Libya,” Draghi said. “And some of them, like the situation in Ukraine and Russia, will have a greater impact on the euro area than they certainly have on other parts of the world.” Still, Draghi also said that on first glance, the interconnections between the euro area and Russia and Ukraine are of a “very limited” nature. It’s “hard to assess the impact at the beginning of these crises,” he said. He added that recent economic data have been disappointing, pointing to a “weak, fragile” recovery. Italy, the currency bloc’s 3rd-largest economy, unexpectedly slipped back into recession in Q2, while factory orders in Germany dropped in Jun, the most since 2011, with the Economy Ministry citing geopolitical tensions as damping the outlook. “If one wants to detect a sign in the last two or three months’ data, there has been a slowing down of growth momentum,” Draghi said. “It’s pretty clear that the countries that have undertaken reforms are performing better, much better, than the countries that haven’t done so.”
Draghi Says Geopolitical Risks to Economy Increasing
21st Century Fox quarterly profit that topped estimates, helped by the performance of its film & cable TV divisions. FOX executives highlighted record profit from films & gains in cable programming. Box-office sales along with the addition of the YES Network, helped overcome a tough climate for cable ads & the Broadcasting’s struggle to develop hits to succeed the fading “American Idol.” Fiscal Q4 EPS excluding items at the entertainment business rose to 42¢ from 31¢ a year earlier. Analysts anticipated 39¢. Revenue grew 17% to $8.4B, beating projections of $8B. Last month, FOX agreed to sell its Sky Italia & Sky Deutschland holdings to its 39% owned affiliate, British Sky Broadcasting Group for more than $9B, consolidating European satellite TV assets there. Cable division profit, from networks such as the Fox News Channel & FX, as well as regional sports outlets, rose 11% to $1.2B, fueled by a 19% gain in payments from domestic pay-TV systems. US ad sales grew 12%, including the consolidation of results from YES. Intl ads grew 5%. The stock jumped 2.24. If you would like to learn more about FOX, click on this link:
club.ino.com/trend/analysis/stock/FOX?a_aid=CD3289&a_bid=6ae5b6f7
Fox Quarterly Earnings Beat Estimates With Film, Cable Units Spurring Gain
Traders are not sure what to do. Earnings have looked a little better lately & fighting in Gaza has quieted down. But fighting continues in Ukraine & the MidEast remains highly unsettled with ISIS making all kinds of threats. Yield sensitive stocks, starting with junk bond funds, after being under selling pressure for more than a week saw buying today. That may just be bargain hunting, not reflecting long term fundamentals. Dow remains on defense, still down 150YTD.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLU14.NYM | ...Crude Oil Sep 14 | ...96.99 |  ...0.07 | (0.1%) |
| GCQ14.CMX | ...Gold Aug 14 | ....1,304.40 | ...2.30 | (0.2%) |
Fewer Americans filed applications for unemployment benefits last week, sending the average over the past month to an 8-year low, a sign the labor market continues to gain momentum. Jobless claims decreased 14K to 289K from 303K in the prior period, according to the Labor Dept. The forecast called for an increase to 304K. Companies are holding on to more workers in an effort to keep up with increased orders & stronger consumer demand, contributing to a virtuous cycle of growth as the economy accelerates. Fewer layoffs & more jobs would support further gains in incomes & household spending, which accounts for 70% of the economy. The 4 week average dropped to 293K, the lowest since Feb 2006, from 297K the week before. The number continuing to receive jobless benefits declined 24K to 2.52M. In that same period, the unemployment rate among people eligible for benefits held at 1.9%.
Jobless Claims Fall as Average Drops to Eight-Year Low
ECB pres Mario Draghii said the risks to the recovery from conflicts including that in Ukraine are increasing. “Heightened geopolitical risks, as well as developments in emerging-market economies and global financial markets, may have the potential to affect economic conditions negatively,” Draghi said after the ECB kept its main interest rates unchanged. “We are strongly determined to safeguard the firm anchoring of inflation expectations over the medium to long term.” Headwinds facing the recovery in the 18-nation euro area are intensifying, after Italy slipped back into recession & the standoff between Russia versus the US & allies. Draghi has in the past said an external shock to the economy that endangers the inflation outlook could be a trigger for broad-based asset purchases, or quantitative easing. “The Governing Council is unanimous in its commitment to use unconventional policy measures like ABS purchases, like QE, if our medium-term outlook for inflation were to change,” Draghi said. “We will closely monitor the possible repercussions of heightened geopolitical risks and exchange-rate developments.” Russia slapped import bans on an array of food goods from the US & Europe today, striking back at sanctions over the conflict in Ukraine. The curbs target nations that have imposed or supported sanctions against Russia & also include Canada, Australia & Norway. “There is no doubt that if you look at the world today, you’ll see that geopolitical risks have increased all over the world: we have the Russian-Ukrainian crisis, Iraq, Gaza, Syria, and Libya,” Draghi said. “And some of them, like the situation in Ukraine and Russia, will have a greater impact on the euro area than they certainly have on other parts of the world.” Still, Draghi also said that on first glance, the interconnections between the euro area and Russia and Ukraine are of a “very limited” nature. It’s “hard to assess the impact at the beginning of these crises,” he said. He added that recent economic data have been disappointing, pointing to a “weak, fragile” recovery. Italy, the currency bloc’s 3rd-largest economy, unexpectedly slipped back into recession in Q2, while factory orders in Germany dropped in Jun, the most since 2011, with the Economy Ministry citing geopolitical tensions as damping the outlook. “If one wants to detect a sign in the last two or three months’ data, there has been a slowing down of growth momentum,” Draghi said. “It’s pretty clear that the countries that have undertaken reforms are performing better, much better, than the countries that haven’t done so.”
Draghi Says Geopolitical Risks to Economy Increasing
21st Century Fox quarterly profit that topped estimates, helped by the performance of its film & cable TV divisions. FOX executives highlighted record profit from films & gains in cable programming. Box-office sales along with the addition of the YES Network, helped overcome a tough climate for cable ads & the Broadcasting’s struggle to develop hits to succeed the fading “American Idol.” Fiscal Q4 EPS excluding items at the entertainment business rose to 42¢ from 31¢ a year earlier. Analysts anticipated 39¢. Revenue grew 17% to $8.4B, beating projections of $8B. Last month, FOX agreed to sell its Sky Italia & Sky Deutschland holdings to its 39% owned affiliate, British Sky Broadcasting Group for more than $9B, consolidating European satellite TV assets there. Cable division profit, from networks such as the Fox News Channel & FX, as well as regional sports outlets, rose 11% to $1.2B, fueled by a 19% gain in payments from domestic pay-TV systems. US ad sales grew 12%, including the consolidation of results from YES. Intl ads grew 5%. The stock jumped 2.24. If you would like to learn more about FOX, click on this link:
club.ino.com/trend/analysis/stock/FOX?a_aid=CD3289&a_bid=6ae5b6f7
Fox Quarterly Earnings Beat Estimates With Film, Cable Units Spurring Gain
Twenty-First Century Fox (FOX)
Traders are not sure what to do. Earnings have looked a little better lately & fighting in Gaza has quieted down. But fighting continues in Ukraine & the MidEast remains highly unsettled with ISIS making all kinds of threats. Yield sensitive stocks, starting with junk bond funds, after being under selling pressure for more than a week saw buying today. That may just be bargain hunting, not reflecting long term fundamentals. Dow remains on defense, still down 150YTD.
Dow Jones Industrials
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