Dow advanced 68, advancers over decliners 2-1 & NAZ gained 39. The MLP index was fractionally higher to the 337s & the REIT index rose 1+ to the 316s. Junk bond funds slid lower & Treasuries retreated, taking the yield on the 10 year Treasury back over 2%. Oil dropped to the 45s & gold was flattish with its eyes on reaching 1200 once again.
AMJ (Alerian MLP Index tracking fund)
Treasury Secretary Jack Lew moved up by 2 days to Nov 3 the deadline by which Congress must raise the nation’s $18.1T debt limit. The Treasury projections have fallen $4-$6B short of expectations, forcing the department to move up the date from Nov 5, Lew said. After the new deadline, the Treasury will have less than $30B to fund the gov, “far short” of expenses on certain days. “The trend in our projected net resources has continued to be negative,” Lew said. “I respectfully urge Congress to take action as soon as possible, raise the debt limit without delay, and remove an unnecessary threat to our economy.” The US is trying to avoid a repeat of Oct 2013, when a debt-extension agreement was reached just before the Treasury had expected to run out of borrowing authority. This time, the negotiations have been complicated by Boehner’s plans to depart. The Treasury is using what it calls extraordinary accounting measures to stay under the borrowing limit. A cash balance of less than $30B would probably be depleted quickly, Lew said, as daily gov expenditures can be as high as $60B. The Treasury’s cash balance was $73B as of Oct 10, down from an average of about $143B in the past year. “Operating the United States government with no borrowing authority, and with only the cash on hand on a given day, would be profoundly irresponsible,” Lew said. The gov makes about 80M payments per month, including Social Security & veteran benefits, military salaries & Medicare reimbursements, he said. Without an increase in the debt limit, the US would be unable to meet such obligations for the first time in history, Lew added.
The number of Americans submitting applications for jobless benefits unexpectedly declined last week to match the fewest in 4 decades. Initial unemployment claims dropped 7K to 255K, according to the Labor Dept. The forecast called for 270K applications & the decline brought the monthly average to its lowest level since 1973. Steady domestic demand even in the face of tepid global growth is encouraging managers to maintain headcounts. At the same time, additions to payrolls have slowed the last 2 months as diminished economic prospects abroad prompt some employers to limit hiring. Jobless claims matched the low reached in Jul, the fewest since 1973. The 4-week average of claims, a less-volatile measure than the weekly figure, decreased to 265K from 267K in the prior week. The number continuing to receive jobless benefits declined 50K to 2.16M, the lowest level since 2000. The unemployment rate among people eligible for benefits held at 1.6%. Claims, since the beginning of Mar, have held below the 300K level that is consistent with strength in the labor market. While dismissals have remained limited, hiring managers have pulled back on adding to staffs amid sluggish global growth.
Stocks are recovering after 2 days of selling. But this is not significant. More earnings are coming & all is not going well on that front as Wal-Mart (WMT), a Dow stock & Dividend Aristocrat, reminded everybody yesterday. Raising the debt ceiling is a major issue & that can get ugly fast with some Reps looking for a fight.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLX15.NYM | ...Crude Oil Nov 15 | ...45.79 |  ...0.85 | (1.8%) |
| GCV15.CMX | ...Gold Oct 15 | ......1,179.70 | ....0.40 | (0.0%) |
Treasury Secretary Jack Lew moved up by 2 days to Nov 3 the deadline by which Congress must raise the nation’s $18.1T debt limit. The Treasury projections have fallen $4-$6B short of expectations, forcing the department to move up the date from Nov 5, Lew said. After the new deadline, the Treasury will have less than $30B to fund the gov, “far short” of expenses on certain days. “The trend in our projected net resources has continued to be negative,” Lew said. “I respectfully urge Congress to take action as soon as possible, raise the debt limit without delay, and remove an unnecessary threat to our economy.” The US is trying to avoid a repeat of Oct 2013, when a debt-extension agreement was reached just before the Treasury had expected to run out of borrowing authority. This time, the negotiations have been complicated by Boehner’s plans to depart. The Treasury is using what it calls extraordinary accounting measures to stay under the borrowing limit. A cash balance of less than $30B would probably be depleted quickly, Lew said, as daily gov expenditures can be as high as $60B. The Treasury’s cash balance was $73B as of Oct 10, down from an average of about $143B in the past year. “Operating the United States government with no borrowing authority, and with only the cash on hand on a given day, would be profoundly irresponsible,” Lew said. The gov makes about 80M payments per month, including Social Security & veteran benefits, military salaries & Medicare reimbursements, he said. Without an increase in the debt limit, the US would be unable to meet such obligations for the first time in history, Lew added.
Lew Sets Earlier Deadline for Congress to Raise Debt Ceiling
China’s broadest measure of new
credit exceeded estimates in Sep, suggesting gov
efforts to boost lending are gaining traction. Aggregate financing
rose to 1.3T yuan ($205B), from an originally reported
1.08T yuan in Aug, according to the People’s Bank of China. That exceeded the estimate for 1.2T yuan. The
report suggests increased infrastructure spending from the gov & 5 interest rate cuts since Nov are helping boost loan
demand. The increase in lending may alleviate global concerns over
China’s growth outlook, which were among reasons cited by FOMC last month for not raising interest rates. New yuan loans rose to 1.05T yuan, compared to an estimate of 900B yuan. M2 money supply increased 13.1% from a year earlier, matching the forecast. China monetary conditions index started to show a rebound since Jul.
China Credit Growth Rebounds as Monetary Easing Spurs Loans
The number of Americans submitting applications for jobless benefits unexpectedly declined last week to match the fewest in 4 decades. Initial unemployment claims dropped 7K to 255K, according to the Labor Dept. The forecast called for 270K applications & the decline brought the monthly average to its lowest level since 1973. Steady domestic demand even in the face of tepid global growth is encouraging managers to maintain headcounts. At the same time, additions to payrolls have slowed the last 2 months as diminished economic prospects abroad prompt some employers to limit hiring. Jobless claims matched the low reached in Jul, the fewest since 1973. The 4-week average of claims, a less-volatile measure than the weekly figure, decreased to 265K from 267K in the prior week. The number continuing to receive jobless benefits declined 50K to 2.16M, the lowest level since 2000. The unemployment rate among people eligible for benefits held at 1.6%. Claims, since the beginning of Mar, have held below the 300K level that is consistent with strength in the labor market. While dismissals have remained limited, hiring managers have pulled back on adding to staffs amid sluggish global growth.
Jobless Claims in U.S. Fall to Match Lowest Level Since 1973
Stocks are recovering after 2 days of selling. But this is not significant. More earnings are coming & all is not going well on that front as Wal-Mart (WMT), a Dow stock & Dividend Aristocrat, reminded everybody yesterday. Raising the debt ceiling is a major issue & that can get ugly fast with some Reps looking for a fight.
Dow Jones Industrials
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