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Monday, November 30, 2015
Mixed markets on last day of November
Dow dropped 29, advancers over decliners 4-3 & NAZ lost 10. The MLP index was a fraction lower, going below 301, & the REIT index gained a fraction to 326. Junk bond funds were mixed to higher & Treasuries went up as stocks lost ground. Oil & gold both rose.
Online sales on Cyber Monday may rise at least 18% from a year
earlier, slower growth than during the holiday weekend, as consumers
start their internet shopping earlier, according to forecasts by
International Business Machines. Total Web-based sales for
the weekend after Thanksgiving increased 26% from a year
earlier. Even with the smaller gain,
Cyber Monday spending may hit a record $3B this year, according
to Adobe Systems. Retail analysts have been paying close
attention to holiday purchasing patterns as more spending shifts online & away from traditional stores. For most of the last decade, the
Mon following Thanksgiving was the busiest day for Web shopping as
US consumers returned to work & used their offices’ fast internet
connections to buy holiday gifts. But the rise of smartphones &
speedier home internet service has led consumers to snag online deals
throughout the holiday weekend. Retailers, traditional & electronic, are now offering bargains earlier than ever. Some of the most popular
items on weekend shopping lists included televisions, as well as the
Apple (AAPL) Watch & Beats by Dre headphones, according to IBM’s Watson
Trend. Other popular choices are hoverboards, running shoes, video-games & Star Wars R2-D2 droids. Thanksgiving
was the fastest-growing online shopping day, with sales rising 25% to a record $1.7B, according to Adobe. About 37%
of Thanksgiving sales came from smartphones & tablets, up from 29% in 2014, according to Adobe. Online spending on Black Friday
increased 14% from 2014.
Contract signings to purchase previously owned homes in the US rose less
than forecast in Oct after declining in the prior 2 months,
showing residential real estate is cooling heading into the quieter
selling season. An index of pending home sales increased 0.2% after a revised 1.6% decline a month earlier,
the National Association of Realtors said. Economists projected a
1% advance last month. Lean
inventories of available properties are limiting choices for
prospective buyers who qualify for credit. At the same time, steady
hiring gains & early signs of a pickup in worker pay probably will
continue to support housing demand even after a recent gain in borrowing
costs in anticipation of an increase in the Federal Reserve’s benchmark
interest rate. “In the
most competitive metro areas -- particularly those in the South and West
-- affordability concerns remain heightened as low inventory continues
to drive up prices,” NAR chief economist Lawrence Yun said. Purchase contracts rose 2.1% in the 12 months
ended in Oct on an unadjusted basis after a 3.2% annual gain
in Sep. The pending sales index was
107.7 on a seasonally adjusted basis. A reading of 100 corresponds to
the average level of contract activity in 2001, or “historically
healthy” home-buying traffic. Economists
consider pending sales a leading indicator because they track new
purchase contracts. Existing-home sales are tabulated when a deal
closes, usually a month or 2 later. Prices increased compared with a year earlier as the number
of dwellings on the market declined.
China’s stocks erased steep losses in the last hour of trading, led
by financial companies, as a 2nd day of wild price swings tested the
gov plan to trim support for the equity market. The
Shanghai Composite Index climbed 0.3% to 3445 at the close,
erasing a loss of as much as 3.2%, as a gauge of volatility
traded near its highest level in 2 months. The benchmark gauge
climbed 1.9% this month, the smallest move since Jan. Fri's
plunge, the biggest in 3 months, illustrates the challenge facing
Chinese officials as they seek to wean the equity market off gov
support without precipitating another crash. As price swings on the
index fell to their lowest levels since Mar, the gov lifted a
freeze on IPOs, raised margin requirements &
scrapped a rule requiring brokerages to hold net-long positions.
China’s
stock rout from mid-Jun thru Aug was only halted after the
gov took a series of measures to backstop the market, including
banning major stakeholders from offloading shares, ordering state funds
to buy & restricting short selling. Policy makers also armed one state
agency with more than $480B to prop up shares. The Shanghai
Composite re-entered a bull market earlier this month. On Fri,
there was little sign that gov-run funds had stepped in to ease
the selloff.
There is not much for stocks to do as they wait to hear more about holidays retail sales. Early Nov reports are coming in the next few days, followed by the Nov jobs report on Fri. Obama has his big meeting on global warming which will get little accomplished besides the usual hot air. Hard to believe, Dow is up 100 this month after its surge last month.
...0.65 
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