Dow edged up 12, decliners slightly ahead of advancers, & NAZ inched up 3. The MLP index was fractionally higher to the 342s & the REIT index rose 2+ to the 321s. Junk bond funds rose & there were buyers for Treasuries. Oil jumped to the 47s & gold lost ground following its recent run.
AMJ (Alerian MLP Index tracking fund)
Factory output fell in Sep for a 2nd month as high inventories & lukewarm demand from overseas customers kept American producers bogged down. The 0.1% drop at manufacturers, which make up 75% of all production, followed a revised 0.4% decrease the prior month, according to the Federal Reserve. The forecast was for a 0.2% decrease. Total industrial production, which also includes mines & utilities, dropped 0.2%. A surge in the dollar since mid-2014 has made US products more expensive in foreign markets at the same time the oil industry cuts back and companies contend with bloated stockpiles. Manufacturing’s woes are only partially being cushioned by steady purchases of automobiles that have led consumer spending in underpinning the economy. Utility output climbed 1.3% for a 2nd month as warmer Sep weather boosted demand for air conditioning. Mining production, which includes oil drilling, slumped 2%, the most in 4 months. Oil & gas well drilling decreased 4%. The report also showed capacity utilization, which measures the amount of a plant that is in use, decreased to a 3-month low of 77.5% from 77.8% the prior month. The output of motor vehicles & parts increased 0.2%. Excluding autos & parts, manufacturing fell 0.1%, the first drop since May.
There was no inspiring news to bring out buyers today. After last week's extraordinary run, Dow is up 70 this week & holding above 17K. Not bad all considered. There will be a flood of earnings reports next week which will give a better flavor about the strength of the economy in Q3. GDP will be out in the last week of Oct.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLX15.NYM | ...Crude Oil Nov 15 | ...47.28 |  ...0.90 | (1.9%) |
| GCV15.CMX | ...Gold Oct 15 | ......1,179.20 | ...8.70 | (0.7%) |
Consumer sentiment climbed more
than forecast in Oct as lower-income Americans projected wage gains
will accelerate & falling energy prices helped stretch paychecks. The University of Michigan’s preliminary consumer sentiment index for
this month rose to 92.1, the first advance in 4 months, from 87.2 in
Sep. The projection called for 89. The bottom 1/3 of the income scale projected their pay over the
next year will increase by the most in more than a decade, & low
inflation combined with cheap borrowing costs boosted plans to buy
big-ticket items. Stabilization in financial markets also eased concern
slowing growth overseas would cause the economy to cool,
even as consumers anticipated smaller increase in payrolls. “Consumers have concluded that the fears expressed on Wall Street do
not extend to Main Street,” Richard Curtin, director of the Michigan
Survey of Consumers, said . “Continued job growth remains
the key, especially since consumers have become more concerned that the
pace of future job growth will slow.” The gauge averaged 93.5 this year, thr Sep, & 84.1
in 2014. The survey’s index of expectations 6 months from
now climbed to 82.7 from 78.2, the month prior. The gauge of current
conditions, which measures Americans’ views of their personal finances,
rose to 106.7 in Oct from 101.2 last month. Americans expected an inflation rate of 2.7% in the next year,
down from 2.8% in Sep. Over the next 5-10 years,
they expected prices would rise 2.6%, matching the lowest since
2002, compared with 2.7% last month. The bottom 1/3 on the pay scale projected incomes would rise 2.9% over the next 12 months, the most optimistic outlook since 1999. The weakening in job prospects occurred mainly among middle-income earners.
Consumer Sentiment in U.S. Exceeds Forecast as Finances Improve
Job openings in the US held near a record in Aug, indicating employment gains will remain steady. The number of positions waiting to be filled dropped by 298K to 5.37M, according to the Labor Dept.
U.S. Job Openings Fell to 5.37 Million In August From 5.67 Million
Factory output fell in Sep for a 2nd month as high inventories & lukewarm demand from overseas customers kept American producers bogged down. The 0.1% drop at manufacturers, which make up 75% of all production, followed a revised 0.4% decrease the prior month, according to the Federal Reserve. The forecast was for a 0.2% decrease. Total industrial production, which also includes mines & utilities, dropped 0.2%. A surge in the dollar since mid-2014 has made US products more expensive in foreign markets at the same time the oil industry cuts back and companies contend with bloated stockpiles. Manufacturing’s woes are only partially being cushioned by steady purchases of automobiles that have led consumer spending in underpinning the economy. Utility output climbed 1.3% for a 2nd month as warmer Sep weather boosted demand for air conditioning. Mining production, which includes oil drilling, slumped 2%, the most in 4 months. Oil & gas well drilling decreased 4%. The report also showed capacity utilization, which measures the amount of a plant that is in use, decreased to a 3-month low of 77.5% from 77.8% the prior month. The output of motor vehicles & parts increased 0.2%. Excluding autos & parts, manufacturing fell 0.1%, the first drop since May.
Production at U.S. Manufacturers Falls for a Second Month
There was no inspiring news to bring out buyers today. After last week's extraordinary run, Dow is up 70 this week & holding above 17K. Not bad all considered. There will be a flood of earnings reports next week which will give a better flavor about the strength of the economy in Q3. GDP will be out in the last week of Oct.
Dow Jones Industrials
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