Friday, March 20, 2015

Higher markets on prospects for another Greek bailout

Dow jumped 172, advancers over decliners almost 5-1 & NAZ added 38 (going over 5K).  The MLP index went up 3+ to 426 (sloshing around 2 year lows) & the REIT index rose 2+ to the 342s.  Junk bond funds were higher & Treasuries advanced.  Oil rose (hard to believe) & gold also was higher.

AMJ (Alerian MLP Index tracking fund)

CLJ15.NYM....Crude Oil Apr 15...45.25 Up ...1.29 (2.9%)

GCH15.CMX...Gold Mar 15....1,179.00 Up ...9.90 (0.9%)

3 Stocks You Should Own Right Now - Click Here!

Greece could win an infusion of bailout money as soon as next week if Prime Minister Tsipras can deliver an adequate package of reform measures, an EU official said.  EU leaders sought to revive bailout talks by signaling they might soon be ready to release some funds so long as Greece fulfills its commitments.  The first money could come from profits euro members made when the ECB bought discounted Greek debt during an earlier phase of the financial crisis.  There’s also money left in the country’s €240B ($258B) bailout program.  The 2 types of prospective aid “are cited in the same breath and both can only be paid out after a successful assessment by the institutions and a decision by the Eurogroup,” German Chancellor Merkel said after 4 hours of talks including Tsipras & ECB pres Draghi.  Leaders have taken a more active role in the Greek negotiations in a bid to push past the logjam that has stymied Tsipras’s efforts to unlock bailout cash since he came to power in Jan on a pledge to end austerity.  Without a breakthrough, Greece could run out of money as soon as this month.  Euro-area finance ministers could meet again as soon as next Fri to discuss the aid prospects   Meanwhile, staff-level negotiations will continue & inspectors in Athens will delve into Greece’s finances & the details of its proposed economic overhaul.  Tsipras said that talks are now back on track & all sides are doing their best to overcome Greece’s troubles, after a meeting he requested on the summit sidelines.  “There was confirmation of the will of all sides to work so as to restore the financing ability of the Greek economy as soon as possible,” Tsipras said.  Greece will submit and enact its own list of structural reforms, according to the Greek premier, who said he’s more optimistic after the meeting.  Greece rolled over €1.6B of short-term notes due Fri & has said it will fulfill the day’s debt obligations.  The euro area’s most-indebted nation is also scheduled to repay €350M to the IMF, while interest due on four bonds held by the ECB totals about €110B.

EU Dangles Prospect of Aid to Entice Greece Into Action

Upscale jeweler Tiffany quarterly sales fell for the first time in 5 years & are expected to decline further in the current qtr, hurt by the strong dollar.  Sales fell 1% in Q4 ended Jan. 31 & are expected to fall 10% in the current qtr while profit is expected to drop 30%.  In Jan TIF cut its profit forecast for the year, saying the stronger dollar not only reduced the value of sales outside the US, but also hurt sales to tourists in the country.  Tourists spend more than $200B annually in the US, but growth in 2015 is expected to decelerate as would-be visitors balk at the stronger dollar & grapple with weaker economies at home.  The company gets about ½ of its revenue from outside the US, while tourists to the country account for a bulk of domestic sales.  The company's revenue slipped to $1.29B from $1.30B, while analysts were expecting a 1.5% rise to $1.31B.  EPS was $1.51, in line with the estimate.  It posted a loss of 81¢ a year earlier due to a legal charge.  The stock fell 2.06.  If you would like to learn more about TIF, click on this liok:

Strong Dollar Hits Tiffany Quarterly Sales

Tiffany (TIF)

Oil prices fell ahead of the latest report on oil drilling activity in the US.  Investors in recent months have been focusing on the number of oil drilling rigs in the US as an indication of eventual supply cuts.  The number of rigs has fallen by more than 40% since Oct.  Analysts, however, caution that a reduction in the number of rigs doesn't immediately translate to a fall in US output, which is currently running at a multiyear high of 9.3M barrels a day.  The latest rig-count will be released later on Fri & analysts expect another drop.  The rate of decline, however, has slowed in recent weeks while US oil inventories have increased to an 80-year high.  Resilience in shale output is that drilling costs are falling & productivity is rising.  Meanwhile, continuing US-Iran talks over Tehran's nuclear program are facing stumbling blocks over a possible lifting of intl sanctions on Iran.  A deal to end sanctions could pave the way for increased Iranian oil exports & would be bearish for the already oversupplied global oil market.

Investors Eye Key Report for Oil Supply Cut Clues

Stocks are in a rally mode.  Dow & S&P 500 are essentially at record highs while NAZ is over 5K, looking to set new records highs after 15 years.  This is called a market priced to perfection.  With another bailout for Greece a few days away, dreary economic fundamentals are no bother to stock buyers.

Dow Jones Industrials

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