Dow fell 30, decliners over advancers more than 2-1 & NAZ declined 16 after recent strength. The MLP index sank 5+ to the 318s & the REIT index lost 1 to the 324s. Junk bond funds were mixed & Treasuries climbed higher. Oil is back down to the 44s & gold inched higher.
AMJ (Alerian MLP Index tracking fund)
Purchases of new US homes slumped in Sep to a 10-month low, disrupting a trend of steady improvement this year in the industry. Sales dropped 11.5% to a 468K annualized pace & the prior 2 months were revised lower, according to the Commerce Dept. The Sep rate, which included a record percentage decline in the Northeast, was weaker than all forecasts. Limited inventory of affordable homes & viable lots on which to build them may be holding back progress in housing, which has helped buffer the US from slower growth abroad. Builders may need confirmation that fundamentals supporting the housing recovery, job growth & cheap borrowing costs, remain in place before investing in additional land & labor. Aug purchases were revised downward to 529K from a previously reported 552K. Jul was revised down by 19K. The median price of a new home increased 13.5% from Sep 2014 to $296K, the highest this year. Purchases dropped in all of 4 regions, led by a record 61.8% slump in the Northeast from a month earlier. The supply of homes at the current sales rate increased to 5.8 months from 4.9 months in Aug. There were 225K new houses on the market at the end of last month, up from 216K in Aug. The number of existing properties on the market decreased 2.6% to 2.21M, the fewest since Apr. At the current pace, it would take 4.8 months to sell those houses compared with 5.1 months at the end of Aug.
German business confidence fell for the first time in 4 months in Oct, signaling that a slowdown in global demand is taking its toll on Europe’s largest economy. The Ifo institute’s business climate index declined to 108.2 from 108.5 in Sep. The estimate was for a drop to 107.8 ECB pres Mario Draghi has all but promised further stimulus in Dec as weakening growth in emerging markets, cheap oil & a stronger € threaten to push down prices & hamper the region’s recovery. While Germany’s export-oriented economy is vulnerable to these risks, it has benefited from solid consumer demand fueled by record-low unemployment so far. A gauge for current conditions fell to 112.6 in Oct from 114, while a measure for expectations unexpectedly increased to 103.8 from 103.3 in Sep. German investor confidence fell to the lowest level in a year this month amid Volkswagen's emission scandal & a deteriorating export outlook. Sales abroad fell 5.2% in Aug, the most since the height of the 2009 recession, while factory orders & industrial output unexpectedly declined.
FedEx will boost holiday-season hiring about 10% to 55K workers to cope with its biggest projected increase in shipping in three years. Package volumes probably are expected to surge 12% to 317M from the day after Thanksgiving thru Christmas Eve, FDX said. Online purchases & an extra day to the 2015 season will drive the gain. This outlook outstrips the National Retail Federation’s prediction for expansion in US holiday-season spending. The group expects consumer purchases to rise 3.7% to $630B in Nov-Dec.
Forecasting has become more difficult because of the growth of online orders sometimes made just before Christmas. A jump in last-minute online shopping & severe winter weather snarled some shipments at during the 2013 holidays. FedEx will expand sorting operations in its ground delivery network to 7 days a week during the peak shipping season, & will extend work at its FedEx Express airline hubs as needed. The stock rose 13¢. If you would like to learn more about FDX, click on this link:
club.ino.com/trend/analysis/stock/FDX?a_aid=CD3289&a_bid=6ae5b6f7
Ahead of the FOMC meeting this week, stocks are fairly quiet. Traders are more interested in playing guessing games about what Janet will do. Based on recent evidence, chances are the overdue rate increase will be postponed one more time with the usual excuse that economic conditions are not perfect. They fail to realize that there never will be a prefect time for an increase.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLZ15.NYM | ....Crude Oil Dec 15 | ...44.29 |  ...0.31 | (0.7% |
| GCV15.CMX | ...Gold Oct 15 | ......1,165.60 | ...2.30 | (0.2%) |
Purchases of new US homes slumped in Sep to a 10-month low, disrupting a trend of steady improvement this year in the industry. Sales dropped 11.5% to a 468K annualized pace & the prior 2 months were revised lower, according to the Commerce Dept. The Sep rate, which included a record percentage decline in the Northeast, was weaker than all forecasts. Limited inventory of affordable homes & viable lots on which to build them may be holding back progress in housing, which has helped buffer the US from slower growth abroad. Builders may need confirmation that fundamentals supporting the housing recovery, job growth & cheap borrowing costs, remain in place before investing in additional land & labor. Aug purchases were revised downward to 529K from a previously reported 552K. Jul was revised down by 19K. The median price of a new home increased 13.5% from Sep 2014 to $296K, the highest this year. Purchases dropped in all of 4 regions, led by a record 61.8% slump in the Northeast from a month earlier. The supply of homes at the current sales rate increased to 5.8 months from 4.9 months in Aug. There were 225K new houses on the market at the end of last month, up from 216K in Aug. The number of existing properties on the market decreased 2.6% to 2.21M, the fewest since Apr. At the current pace, it would take 4.8 months to sell those houses compared with 5.1 months at the end of Aug.
Sales of New U.S. Homes Slump to Lowest Level Since November
German business confidence fell for the first time in 4 months in Oct, signaling that a slowdown in global demand is taking its toll on Europe’s largest economy. The Ifo institute’s business climate index declined to 108.2 from 108.5 in Sep. The estimate was for a drop to 107.8 ECB pres Mario Draghi has all but promised further stimulus in Dec as weakening growth in emerging markets, cheap oil & a stronger € threaten to push down prices & hamper the region’s recovery. While Germany’s export-oriented economy is vulnerable to these risks, it has benefited from solid consumer demand fueled by record-low unemployment so far. A gauge for current conditions fell to 112.6 in Oct from 114, while a measure for expectations unexpectedly increased to 103.8 from 103.3 in Sep. German investor confidence fell to the lowest level in a year this month amid Volkswagen's emission scandal & a deteriorating export outlook. Sales abroad fell 5.2% in Aug, the most since the height of the 2009 recession, while factory orders & industrial output unexpectedly declined.
German Business Confidence Falls as Global Risks Take Toll
FedEx will boost holiday-season hiring about 10% to 55K workers to cope with its biggest projected increase in shipping in three years. Package volumes probably are expected to surge 12% to 317M from the day after Thanksgiving thru Christmas Eve, FDX said. Online purchases & an extra day to the 2015 season will drive the gain. This outlook outstrips the National Retail Federation’s prediction for expansion in US holiday-season spending. The group expects consumer purchases to rise 3.7% to $630B in Nov-Dec.
Forecasting has become more difficult because of the growth of online orders sometimes made just before Christmas. A jump in last-minute online shopping & severe winter weather snarled some shipments at during the 2013 holidays. FedEx will expand sorting operations in its ground delivery network to 7 days a week during the peak shipping season, & will extend work at its FedEx Express airline hubs as needed. The stock rose 13¢. If you would like to learn more about FDX, click on this link:
FedEx Boosts Holiday Hiring 10% to 55,000 on Package Surge
FedEx (FDX)
Ahead of the FOMC meeting this week, stocks are fairly quiet. Traders are more interested in playing guessing games about what Janet will do. Based on recent evidence, chances are the overdue rate increase will be postponed one more time with the usual excuse that economic conditions are not perfect. They fail to realize that there never will be a prefect time for an increase.
Dow Jones Industrials
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