Dow gained 93, advancers over decliners 2-1 & NAZ went up 29. The MLP index recovered 4+ to the 253s & the REIT index was fractionally lower in the 229s. Junk bond funds fell & Treasuries declined, taking the yield on the 10 year Treasury up to 2.86%. Oil did little in the 61s & gold was weak again, down 6 to 1311.
AMJ (Alerian MLP Index tracking fund)
Stocks opened higher, as traders looked past White House turmoil to next week's Federal Reserve rate announcement. Better-than-expected factory output pushed 10-year Treasury yields higher & helped the $ erase losses. The S&P 500 rose in early trading. Trading may be subject to unexpected swings in soaring volume because of a quarterly event known as “quadruple witching,” when futures & options contracts on indices & individual stocks expire. European equities drifted after Asian shares slipped, with equities traders showing little conviction. The € pared an advance after the region's inflation figures were revised downward. Investors are weighing the prospects for heightened US trade protectionism. West Texas crude steadied above $61 a barrel as signs of stronger US fuel consumption balanced OPEC's forecasting for the first time that new supplies from its rivals will exceed demand growth this year.
Consumer sentiment in Mar unexpectedly jumped to a 14-year high after tax cuts boosted disposable incomes, while new tariffs boosted inflation expectations & dimmed the outlook, a Univ of Mich survey showed. Sentiment index rose to 102 (est 99.3) from 99.7 in Feb. Current conditions gauge, which measures Americans' perceptions of their finances, advanced to 122.8, highest in data back to 1946, from 114.9. Expectations measure decreased to 88.6 from 90. The advance in confidence should help underpin consumer spending, the biggest part of the US economy, after a report earlier this week showed a sluggish start to the year for retail sales. A tightening labor market, rising home prices & tax cuts enacted in Dec are supporting optimism among Americans. At the same time, the direction of sentiment was split. Respondents in the bottom 1/3 of household income posted a 15.7-point gain in the index, while the top 1/3 recorded a 7.3-point decline. In addition, the tariffs on imported steel & aluminum earned unfavorable mentions in the survey at roughly the same rate as favorable mentions of the tax cuts. Tariffs dimmed respondents' prospects for the economy & helped raise inflation expectations. Also, respondents' expected gains in incomes in the year ahead fell to 1.8% from 2.2%. All of the decline in expected income gains came among respondents in the top 1/3 of incomes. Even so, positive sentiment dominated the latest survey: 59% of respondents cited recent financial progress, the most since the survey began in 1946, while the share citing income gains rose to a 5-decade high. “While income gains are anticipated by consumers, the March survey found that the size of the expected income increase returned to the lows recorded in the past year,” Richard Curtin, director of the consumer survey, said.
US new-home construction cooled by more than expected in Feb on a reversal in the volatile multifamily category, while building remained on pace to contribute to economic growth this qtr, government figures showed. Residential starts fell 7% to a 1.24M annualized rate (est 1.29M) after 1.33M pace in prior month. Single-family home starts rose 2.9%, 2nd straight gain & multifamily starts fell 26.1% after similar jump the prior month. Permits, a proxy for future construction of all types of homes, fell 5.7% to 1.3M rate (est 1.32M) from 1.38M pace. Even with the Feb decline, the results indicate homebuilding is continuing the progress made last year, with demand supported by a tight job market and steady pay gains. Mortgage rates remain historically low despite recent increases & consumer confidence is elevated as tax cuts aid disposable income. The report indicated a tight supply of homes is getting an influx: The number of housing units completed rose to a 1.32M annualized rate, the highest in 10 years. That may bode well for buyers, as the lack of inventory in recent years has helped reduce affordability. A gauge of homebuilders’ confidence eased to a 4-month low but remained near its highest point in nearly 2 decades, according to a report yesterday. Further gains in homebuilding depend on whether certain market factors persist, including a shortage of workers, rising material costs & what developers say is a lack of buildable lots. Single-family home starts rose to a 902K rate, highest in 3 months, from 877K.
The bulls are back, taking the market higher. Economic news remains good & they are adjusting to sudden changes coming from DC. Nest week's Fed meeting is looming as big, especially when they project how many more rate hikes are coming in 2018. The Dow is down this week, but the bulls are hoping to push it over 25K by the end of the session. It has been choppy in recent weeks while remaining near 25K.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 61.09 | -0.10 | -0.2% |
| GC=F | Gold | 1,312.80 | -5.00 | -0.4% |
Stocks opened higher, as traders looked past White House turmoil to next week's Federal Reserve rate announcement. Better-than-expected factory output pushed 10-year Treasury yields higher & helped the $ erase losses. The S&P 500 rose in early trading. Trading may be subject to unexpected swings in soaring volume because of a quarterly event known as “quadruple witching,” when futures & options contracts on indices & individual stocks expire. European equities drifted after Asian shares slipped, with equities traders showing little conviction. The € pared an advance after the region's inflation figures were revised downward. Investors are weighing the prospects for heightened US trade protectionism. West Texas crude steadied above $61 a barrel as signs of stronger US fuel consumption balanced OPEC's forecasting for the first time that new supplies from its rivals will exceed demand growth this year.
U.S. Stocks Open Higher on Brisk Factory Output: Markets Wrap
Consumer sentiment in Mar unexpectedly jumped to a 14-year high after tax cuts boosted disposable incomes, while new tariffs boosted inflation expectations & dimmed the outlook, a Univ of Mich survey showed. Sentiment index rose to 102 (est 99.3) from 99.7 in Feb. Current conditions gauge, which measures Americans' perceptions of their finances, advanced to 122.8, highest in data back to 1946, from 114.9. Expectations measure decreased to 88.6 from 90. The advance in confidence should help underpin consumer spending, the biggest part of the US economy, after a report earlier this week showed a sluggish start to the year for retail sales. A tightening labor market, rising home prices & tax cuts enacted in Dec are supporting optimism among Americans. At the same time, the direction of sentiment was split. Respondents in the bottom 1/3 of household income posted a 15.7-point gain in the index, while the top 1/3 recorded a 7.3-point decline. In addition, the tariffs on imported steel & aluminum earned unfavorable mentions in the survey at roughly the same rate as favorable mentions of the tax cuts. Tariffs dimmed respondents' prospects for the economy & helped raise inflation expectations. Also, respondents' expected gains in incomes in the year ahead fell to 1.8% from 2.2%. All of the decline in expected income gains came among respondents in the top 1/3 of incomes. Even so, positive sentiment dominated the latest survey: 59% of respondents cited recent financial progress, the most since the survey began in 1946, while the share citing income gains rose to a 5-decade high. “While income gains are anticipated by consumers, the March survey found that the size of the expected income increase returned to the lows recorded in the past year,” Richard Curtin, director of the consumer survey, said.
Consumer Sentiment in U.S. Jumps to 14-Year High After Tax Cuts
US new-home construction cooled by more than expected in Feb on a reversal in the volatile multifamily category, while building remained on pace to contribute to economic growth this qtr, government figures showed. Residential starts fell 7% to a 1.24M annualized rate (est 1.29M) after 1.33M pace in prior month. Single-family home starts rose 2.9%, 2nd straight gain & multifamily starts fell 26.1% after similar jump the prior month. Permits, a proxy for future construction of all types of homes, fell 5.7% to 1.3M rate (est 1.32M) from 1.38M pace. Even with the Feb decline, the results indicate homebuilding is continuing the progress made last year, with demand supported by a tight job market and steady pay gains. Mortgage rates remain historically low despite recent increases & consumer confidence is elevated as tax cuts aid disposable income. The report indicated a tight supply of homes is getting an influx: The number of housing units completed rose to a 1.32M annualized rate, the highest in 10 years. That may bode well for buyers, as the lack of inventory in recent years has helped reduce affordability. A gauge of homebuilders’ confidence eased to a 4-month low but remained near its highest point in nearly 2 decades, according to a report yesterday. Further gains in homebuilding depend on whether certain market factors persist, including a shortage of workers, rising material costs & what developers say is a lack of buildable lots. Single-family home starts rose to a 902K rate, highest in 3 months, from 877K.
U.S. Housing Starts Cooled in February After Robust January
The bulls are back, taking the market higher. Economic news remains good & they are adjusting to sudden changes coming from DC. Nest week's Fed meeting is looming as big, especially when they project how many more rate hikes are coming in 2018. The Dow is down this week, but the bulls are hoping to push it over 25K by the end of the session. It has been choppy in recent weeks while remaining near 25K.
Dow Jones Industrials
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