Tuesday, October 10, 2017

Markets rise to records on Wal-Mart projections

Dow gained 36, advancers over decliners better than 2-1 & NAZ went up 6.  The MLP index rose in the 285s & the REIT index rose 1+ to the 353s.  Junk bond funds did little & Treasuries were also strong.  Oil inched up pennies & gold added 10 to 1295.

AMJ (Alerian MLP Index tracking fund)

stock chart

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Stocks climbed to record highs led by a rally in consumer shares & energy producers climbed along with oil prices.  Politics remained the dominant theme in Europe as Spanish stocks declined & the € rose before a pivotal meeting of Catalan's regional parliament.  The $ had weakened against most major currencies as Pres Trump's feud with Senator Corker clouded the outlook for his much-heralded tax reform.  Traders are also waiting for minutes from the Federal Reserve's last meeting, which may provide more details on the path of interest rates & balance sheet tapering.  The S&P 500, Dow & Nasdaq all set record highs.  Catalan lawmakers will meet today to consider a declaration of independence that risks an ironclad backlash from Madrid.  Spanish police are ready to arrest Catalan Pres Carles Puigdemont immediately if he declares independence in the regional parliament, according to leakers.  The IBEX fell, leading declines amid mixed national benchmarks.  The common currency gained for a 3rd day & bond yields across Europe edged higher.
U.S. Stocks Hit New Highs, Spanish Equities Drop: Markets Wrap

Walmart (WMT), a Dow stock & Dividend Aristocrat, unveiled a $20B share buyback plan & forecast US online sales to increase by about 40% in the fiscal year ending Jan 2019.  The shares rose after the company also forecast overall net sales to increase by at least 3% in the same period.  The company has been doubling down on its online business & is leveraging its 4700 plus stores to create a more hassle-free experience for its online shoppers.  The company reported a 60% jump in online sales in the US in its latest qtr ended Jul.  The largest US grocery retailer also said it expects to add 1K locations for shipping online grocery orders in fiscal year 2019.  It currently ships online orders from more than 900 US locations.  The company forecast profit for fiscal year 2019 to increase about 5% over the expected adjusted EPS of $4.30-4.40 for the year ending Jan 2018.  The stock jumped up 3.50.  If you  would like to learn more about WMT, click on this link:
Walmart launches $20B buyback plan

The IMF raised its projections for global economic growth in 2017, on assumptions that the “baseline outlook is strengthening” in both emerging markets & most developed countries.  For the global economy as a whole, the IMF predicts growth to register at 3.6% for this year & 3.7% in 2018, both readings are a 0.1% upward revision from the agency’s Apr forecasts.  Meanwhile, the IMF left its forecast for the US unchanged for 2017, at 2.2%, based on “significant policy uncertainty."  Earlier forecasts had taken into account the prospect of growth-stimulating tax cuts in the US; the IMF now sees that outcome as less certain for the current year.  One of the main drivers of the higher global growth forecast was increased economic activity in developed economies, particularly China, where the IMF predicts GDP will register at 6.8% for the year.  GDP forecasts were raised across Europe as well.  Some risk factors to global growth include a rollback of post-financial crisis regulations, a shift toward protectionist policies, persistently low inflation in advanced economies & a more rapid shift toward tighter global financial conditions.

US growth projections stagnate over tax reform uncertainty: IMF report

Stocks remain in demand.  The projection by WMT was encouraging for the stock market, a good way to begin earnings season.  Dow is up an amazing almost 4½K (24%) in a little under a year since the election.  That has to be one of the greatest advances in history & the bears are nowhere to be seen.  However gold, a main alternative for investing in stocks, is also on the rise once. 

Dow Jones Industrials

stock chart

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