Friday, March 27, 2015

Markets edge higher on consumer confidence data

Dow rose 20, advancers over decliners 5-4 & NAZ added 14.  The MLP index slipped chump change to 428 & the REIT index inched higher in the 326s.  Junk bond funds did little & Treasuries climbed higher, taking the yield on the 10 year Treasury below 2%.  Oil pulled back 1 & gold slid under 1200.

AMJ (Alerian MLP Index tracking fund)

CLK15.NYM...Crude Oil May 15...50.29 Down ...1.14  (2.2%)

GCH15.CMX...Gold Mar 15......1,196.30 Down ...8.80  (0.3%)

3 Stocks You Should Own Right Now - Click Here!

US consumer sentiment fell month-over-month in Mar, a survey showed, though the reading was better than expected.  The University of Michigan's final Mar reading on the overall index on consumer sentiment came in at 93, topping both the preliminary read of 91.2 as well as the forecast for a reading of 92.  However, it was below the final Feb reading of 95.4.

Consumer Sentiment Rises More than Expected

The US economy expanded at 2.2% annualized pace in Q4, led by the biggest gain in consumer spending in 8 years.  The revised increase in GDP, the value of all goods & services produced, matched the Commerce Dept’s previous estimate.  The report also showed corp profits dropped, capping the worst annual performance since the recession.  The rate of economic growth will prove hard to replicate this qtr as harsh winter weather, a stronger dollar, a port slowdown & a global oil glut translate into disappointing spending on the part of consumers & businesses.  Job growth, one of the few economic indicators that charged ahead unabated in Q1, will probably help support demand for much of the year.  The forecast called for growth of 2.4%.  An upward revision to consumer spending & exports was mostly offset by smaller gains in inventories.  For all of 2014, the US economy grew 2.4% from the year before, the most since 2010 & following a 2.2% advance in 2013.  Household consumption, which accounts for 2/3 of the economy, was revised up to show a 4.4% gain at an annualized rate in Q4, the most since Q1-2006.  It was previously estimated at 4.2%.  The update reflected bigger outlays on health care. For all of 2014, consumer spending rose 2.5%, the most since 2006.  The Commerce Dept report also included data on Q4 corp profits.  Before-tax earnings fell 1.4% after rising 3.1% in the prior qtr, depressed by declines among financial institutions & foreign affiliates.  A 4% gain at an annualized rate in personal income made up for the drop in corp earnings & helped propel gross domestic income up by 3.1%.  For all of 2014, corp profits were down 0.8%, the first decrease since 2008.  The outlook for 2015 has dimmed with the jump in the dollar.

Economy in U.S. Expanded at 2.2% Pace in Fourth Quarter

Even Greek Prime Minister Tsipras’s friends in Germany are getting exasperated with his gov after a visit to Berlin fueled skepticism that he can do what’s needed to end the impasse over his country’s finances.  While the atmosphere was good in talks between Tsipras & Chancellor Merkel this week, an improvement in tone may not help resolve a standoff over the reforms required to unlock aid, according to a German gov official.  Members of Merkel’s Social Democratic coalition partners, who have sought to strike a more moderate tone on Greece than her party, were left unconvinced that he can resolve the crisis.  “What’s coming out of Greece is moving completely in the wrong direction,” Joachim Poss, a Social Democratic lawmaker who is the party’s deputy parliamentary spokesman on finance policy, said.  “The situation is really worrying -- we’re stunned watching the developments.”  Tsipras’s difficulty in persuading even more measured German policy makers he’s on the right track risks entrenching a conflict with Greece’s European creditors as his gov runs out of money.  More than a month after winning an extension of the country’s bailout deal, Greek officials will finally submit plans on how they’ll meet the conditions for releasing aid on Fri.  The delay led Thomas Oppermann, the Social Democrat Bundestag floor leader, to join Finance Minister Wolfgang Schaeuble in speculating about a possible Greek exit.  “A Greek exit from the euro zone would be a political disaster, not only for the euro zone but for the whole idea of Europe,” Oppermann said.  “Of course we can’t rule that out. It’s first of all down to the Greek government whether it does what is required to stay in the euro zone.”  Ministers are unlikely to consider the latest proposals before the Easter holiday, an EU official said.  Social Democrats in Berlin complained that Tsipras’s gov appeared to be dragging its feet on the steps necessary, & even rolling back anti-corruption efforts & faltering in its attempts to raise more tax revenue.

Greece’s German Allies Aghast as Tsipras Fails to Assure

After 4 straight down days, buyers may bid prices up today.   Nothing really new while the intl scene is very troubled.  Yemen, a country most have never heard of, is in chaos as the Saudis lead a coalition to oust the bad guys.  Iraq is a mess with Iran helping to throw out their bad guys.  Not sure how that will play out.  Syria is going nowhere fast.  Ukraine has been reletively quiet recently, but those problems persist.  Dow is down 400 in Mar  & still in the red YTD as earnings season approaches.

Dow Jones Industrials

No comments: