Dow fell 40, decliners over advancers almost 2-1 & NAZwas off 16. The MLP index rose 2+ to the 438s & the REIT index lost fraction in the 318s. Junk bond funds drifted lower & Treasuries climbed higher. Oil is back over 60 & gold is making another assault on 1200.
AMJ (Alerian MLP Index tracking fund)
Although the timing is uncertain, the Federal Reserve’s (FED) first
interest-rate increase since 2006 will usher in a “regime shift” that
will stir financial markets when it occurs, said New York Fed pres
William C. Dudley. “After more than six years at the zero lower bound, lift-off will
signal a regime shift even though policy would only be slightly less
accommodative after lift-off than it is before,” Dudley said in Zurich today. “I expect that
this will have implications for global capital flows, foreign exchange
valuation and financial asset prices even if it is mostly anticipated
when it occurs.” The FED has said it will raise its benchmark federal funds rate --
which has been near zero since Dec 2008, when it sees further
labor-market improvement & is “reasonably confident” inflation will
rise back to its 2 percent goal over time. Many economists predicted the central bank will start
tightening in Sep. Dudley said markets will be able to anticipate rate liftoff by
monitoring incoming data, which ought to “help mitigate the degree of
market turbulence” when the FED does move. “Nevertheless, I think it
would be naïve not to expect some impact.” He also said “several” important emerging-market economies were
vulnerable to higher US interest rates, while adding that they
“generally appear to be better equipped today to handle the Fed’s
prospective exit from its exceptional policy accommodation than they
were during past tightening cycles.”
Gap welcomed fewer shoppers in April across all three of its major brands. Store-sales sank 15% at Gap & Banana Republic compared to the year-ago period, while sales at Old Navy dipped 6%. The company blamed the early Easter holiday for the weak monthly sales. However, the Q1 wasn’t much better, with the exception of Old Navy, which saw a sales bump of 3%. Sales at Gap fell 10% & Banana Republic 8%, steeper declines than the year-ago qtr. CFO Sabrina Simmons highlighted the positive trends at discount chain Old Navy while also acknowledging the need to increase sales. “We remain focused on driving improved performance across our other divisions,” said Simmons. As a result, Q1 net sales fell 3% to $3.66B, missing estimates of $3.7B. Diluted EPS will range from 55-56¢, in line with estimates. GPS will officially report results on May 21. The stock fell 1.15. If you would like to learn more about GPS, click on this link:
club.ino.com/trend/analysis/stock/GPS?a_aid=CD3289&a_bid=6ae5b6f7
Markets are just slipping & sliding with not a lot going on., But there was another signal that retail sales will not be pretty.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
CLM15.NYM | ...Crude Oil Jun 15 | ...60.05 | ......0.80 | (1.4%) |
GCK15.CMX | ...Gold May 15 | ....1,194.60 | ...11.40 | (1.0%) |
Fed’s Dudley Says Interest Rate Increases Will Mark Regime Shift
Gap welcomed fewer shoppers in April across all three of its major brands. Store-sales sank 15% at Gap & Banana Republic compared to the year-ago period, while sales at Old Navy dipped 6%. The company blamed the early Easter holiday for the weak monthly sales. However, the Q1 wasn’t much better, with the exception of Old Navy, which saw a sales bump of 3%. Sales at Gap fell 10% & Banana Republic 8%, steeper declines than the year-ago qtr. CFO Sabrina Simmons highlighted the positive trends at discount chain Old Navy while also acknowledging the need to increase sales. “We remain focused on driving improved performance across our other divisions,” said Simmons. As a result, Q1 net sales fell 3% to $3.66B, missing estimates of $3.7B. Diluted EPS will range from 55-56¢, in line with estimates. GPS will officially report results on May 21. The stock fell 1.15. If you would like to learn more about GPS, click on this link:
club.ino.com/trend/analysis/stock/GPS?a_aid=CD3289&a_bid=6ae5b6f7
Gap Store Sales Gutted, Drags on 1Q
Gap, Inc. (GPS)
Markets are just slipping & sliding with not a lot going on., But there was another signal that retail sales will not be pretty.
Dow Jones Industrials
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