Thursday, April 21, 2016

Markets edge higher as oil declines from recent highs

Dow lost 18, advancers over decliners about 5-4 & NAZ gained 10.  The MLP index went up to the 298s, another 2016 high, & the REIT index was off a tad in the 336s.  Junk bond funds inched higher & Treasuries were little changed.  Oil slid back 1 & gold was lower, holding at 1250.

AMJ (Alerian MLP Index tracking fund)

Crude Oil
-0.54 (-1.22%)

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Jobless claims unexpectedly decreased to the lowest level since 1973, indicating the labor market remains a pillar of support the economy.  New applications for unemployment benefits fell 6K to 247K last week, according to the Labor Dept.  The forecast called for 265K claims.  The number of Americans already on benefit rolls declined to a more than 15-year low.
Limited dismissals signal that employers are still optimistic about the US demand outlook.  The 4-week moving average of claims decreased to 260K from 265K.  The average was little changed from the 259K during the comparable period in Mar.  The number continuing to receive jobless benefits fell 39K to 2.14M, the fewest since 2000.  The unemployment rate among people eligible for benefits held at 1.6%.  First-time claims have held below 300K, a level associated with robust labor conditions, for 59 consecutive weeks, the longest such stretch since 1973.

U.S. Jobless Claims Unexpectedly Drop to Lowest Level Since 1973

Mario Draghi called for critics of ECB policy to give its unprecedented stimulus measures time to work, & urged govs to help.  “Our policies work, they are effective -- just give them time,” he said after policy makers kept interest rates unchanged at record lows & maintained asset purchases at €80B ($90B) a month.  “If there were also structural reforms, the effect of these policies would be quicker.”  The Governing Council discussed the political attacks on the institution & was unanimous in agreeing the ECB is acting within its mandate, Draghi said.  The Governing Council earlier left the benchmark rate at zero & the deposit rate at minus 0.4%.

Draghi Says Stimulus Is Working as ECB Defends Independence

Oil retreated from the highest level in almost 5 months amid rising US crude stockpiles & speculation producers will be unable to agree on an output freeze.  Crude inventories climbed to 538M barrels last week, the highest level since 1930, the Energy Information Administration.  Prices surged yesterday after the EIA said US crude output fell to an 18-month low.  Cooperation between producers is still possible, said Saudi Oil Ministry adviser Ibrahim Al-Muhanna.  But talks Sun between OPEC members & other producers ended without a deal to limit output.

Once again, not a lot happening in the stock market.  Oil finally gave up a little of recent gains, although it's still trading at levels which suggest problems will be resolved fairly quickly.  Dow is hanging in a little below its record highs last year, hoping earnings will being even higher prices.

Dow Jones Industrials


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