This blog gives investors more financial information for very smart investing!
Tuesday, October 13, 2015
Markets struggle for gains as earnings season begins
Dow rose 26, advancers ahead of decliners 4-3 & NAZ added 13. The MLP index lost 2 to the 339s & the REIT index was even at 320. Junk bond funds were mixed & Treasuries were higher. Oil rebounded after selling last week & gold climbed slightly higher.
US small companies see
wage growth accelerating in coming months after 23% said in
Sep that they recently boosted worker compensation. A net 16% of managers last month said
they plan to increase pay, up 3 percentage points from Aug & the 2nd-largest share since 2007, according to the seasonally adjusted
results by the National Federation of
Independent Business. The proportion of business owners who said they
had recently raised pay was unchanged from Aug.
The group’s index of
small-business optimism rose to a 4-month high of 96.1 in Sep from 95.9, but measure remains below the 42-year average of 98. The
survey by the NFIB, a lobbying group that says it has 325K small &
independent business owners as members, was a leading indicator of
national wage growth until 2012, when the correlation broke down. Since
the start of 2013, the percentage of smaller companies preparing to
increase pay has been as low as 6% & as high as 17%. Average
hourly earnings reported on Oct 2 by the Labor Dept advanced 2.2% in Sep from a year earlier, unchanged from the 12 months
ended in Aug.
German investor confidence fell to the lowest level in a year as Europe’s largest economy faces the fallout of Volkswagen's emissions scandal & weaker growth in emerging markets. The
ZEW Center for European Economic Research index of
investor & analyst expectations, which aims to predict economic
developments 6 months ahead, slid to 1.9 in Oct from 12.1 in
Sep. That’s the 7th consecutive decline & compares with an
estimated drop to 6.5.
Volkswagen’s
admission that it fixed emissions tests in 11M of
its diesel-engine cars cost the company as much as $33B in market
value & sent Germany’s benchmark DAX Index down 3.5% in the 2 trading days that followed. The news broke as Germany’s
trade-focused economy struggled to adapt to receding demand in emerging
markets. Exports fell 5.2% in Aug, the most since the height of the 2009
recession. Factory orders & industrial output unexpectedly declined, & the country’s leading economic research institutes lowered their
2015 growth forecast. At the same time, domestic consumption, investment & a recovery in the neighboring euro region are still lending support
to the German economy. Business confidence as measured by the Ifo
research institute unexpectedly improved in Sep. “The
exhaust-gas scandal of Volkswagen and the weak growth of emerging
markets has dampened economic outlook for Germany,” ZEW said. “However,
the performance of the domestic economy is still good and the euro-area
economy continues to recover.” ZEW’s gauge for current conditions
in Germany fell to 55.2 in Oct from 67.5 & a measure for business
expectations in the 19-nation euro region fell to 30.1 from 33.3.
Chinese stocks fell for the first
time in 3 days in Hong Kong trading, led by commodity producers, as
data showing a slump in imports deepened concern about the outlook for
the economy. The Hang Seng China
Enterprises Index, the best-performing Asian stocks measure in the past
month, dropped 1% to 10,437. A trade report
showed imports plunging 17.7% in Sep, an 11th straight
decline, compared with an estimate for a 16.5% drop. Exports
weakened less than forecast. The Shanghai Composite Index rose slightly to 3293 as technology &consumer companies rallied.
H-shares
halted a 14% rally from a Sep low. Chinese stocks have
rebounded amid speculation that China’s central bank will reduce
interest rates or reserve-requirement ratios & policy makers will
introduce more measures to boost growth. The gov announced over
the weekend it will expand a relending trial to 9 more cities &
provinces, while Premier Li Keqiang said policy makers will increase fiscal support for shantytown redevelopment. The drop in imports
compared with the previous
month's 14.3% decrease. Overseas shipments fell 1.1%, compared
with a 6.1% decline in Aug & the forecast for a 7.4%
slide. The trade surplus was 376B yuan ($59B).
Stocks are meandering, looking for direction from earnings reports. The intl scene is gloomy, highlighted by the chaos in the MidEast. Germany & China have sluggish economies that are going nowhere fast. And the US economy is not doing much better. But Dow is hanging in above 17K.
...0.04 
No comments:
Post a Comment