Dow fell 94, decliners slightly ahead of advancers & NAZ dropped a very big 90. The MLP index rebounded 2+ to the 238s & the REIT index was up fractionally to the 322s. Junk bond funds fluctuated & Treasuries had a modest gain in prices. Oil slid lower to the 64s & gold sank 13 to 1334.
AMJ (Alerian MLP Index tracking fund)
Pres Trump’s push to rebalance global trade in America's favor has investors on edge, as his threats to impose import tariffs & curb foreign investment raise the specter of retaliation that could spark a global trade war. The White House offensive is occurring on several fronts: it's renegotiating the North American Free Trade Agreement & has agreed to revise its bilateral trade pact with South Korea; it's in talks with nations & blocs that want exemptions from steel & aluminum tariffs & it's considering how to punish China for alleged theft of intellectual property. Beijing has threatened to retaliate by imposing tariffs of its own. The Trump administration’s tariffs on China will focus on high-tech industries where Beijing wants to lead, according to a senior White House trade adviser. The list of products the US hits with tariffs will line up with technologies China identified in its “Made in China 2025” strategy, White House adviser Peter Navarro said. “China in my view brazenly has released this China 2025 plan that basically told the rest of the world, ‘We’re going to dominate every single emerging industry of the future, and therefore your economies aren’t going to have a future,”’ Navarro added. “It’s artificial intelligence, robotics, quantum computing.”
A gauge of signed contracts to purchase previously-owned US homes increased in Feb for the first time in 3 months, highlighting uneven progress in the industry, according to data from the National Association of Realtors. The index rose 3.1% M/M (est 2% gain) after a downwardly revised 5% decrease. The gauge fell 4.4% Y/Y on an unadjusted basis after a 1.9% decline. While the month-over-month gain shows demand for housing is still getting support from steady hiring, the market is facing several headwinds. Buyers are up against a persistent shortage of affordable listings to choose from, property prices continue to climb & mortgage costs are rising. What’s more, the Realtors group expects winter weather to weigh on demand in the Northeast. The NAR currently projects 2018 home sales will match 2017's 5.51M. The group expects the median selling price of a previously owned home to increase around 4.2% this year after 5.8% in 2017. “The expanding economy and healthy job market are generating sizeable homebuyer demand, but the miniscule number of listings on the market and its adverse effect on affordability are squeezing buyers and suppressing overall activity,” Lawrence Yun, NAR's chief economist, said. “Homeowners are already staying in their homes at an all-time high before selling and any situation where they remain put even longer only exacerbates the nation’s inventory crunch,” he added. The NAR's 2017 Profile of Home Buyers & Sellers showed the median tenure a homeowner stayed in their house before selling was 10 years, the highest in records back to 1981.
The US economy grew in Q4 at a faster pace than last estimated, helped by an upward revision to household spending on services & a smaller drag from inventories, according to the Commerce Dept. GDP grew at a 2.9% annualized rate, (est 2.7%) revised from 2.5%. Consumer spending, biggest part of the economy, grew 4% (est 3.8%) revised from 3.8%. Before-tax corp pretax profits rose 2.7% Y/Y in the first estimate issued for Q4; climbed 5.3% in Q3. Inventories subtracted 0.53 ppt from GDP growth, compared with prior estimate of 0.7 ppt drag. Nonresidential fixed investment rose 6.8%, revised from 6.6% gain & reflecting a 6.3% jump in outlays for structures (prev est. 2.5%). GDP, adjusted for inflation, rose 0.9% following 2.4% gain in Q3. The revisions to GDP, the value of all goods & services produced in the US, indicate the economy was on a solid footing coming into the current qtr. The report also included the first look at the health of corp America toward the end of 2017. The gain in Q4 profits from a year earlier, together with lower corp taxes following the tax overhaul late last year, bodes well for business investment & employment. Household purchases, which account for about 70% of the economy, also are likely to be supported in coming months by bigger after-tax paychecks and the robust labor market. Continued gains in consumer spending & business investment will help to sustain the expansion even as GDP growth is projected to cool somewhat in Q1. The Federal Reserve Bank of Atlanta’s GDPNow tracking estimate for the current qtr was at 1.8% as of Mar 23. The latest forecast by economists called for a 2.5% pace. While the survey shows consumer spending slowing to a 2.1% rate, Fed officials remain upbeat about the prospects for households. Policy makers this month boosted their forecast for economic growth this year to 2.7% from 2.5% at their Dec meeting. The expansion, in its 9th year, is poised to become the 2nd-longest on record later in 2018. Price data in the GDP report showed inflation is hovering near the Fed's 2% goal. Excluding food & energy, the central banks's preferred price index that is tied to personal spending rose at an unrevised 1.9% annualized rate.
U.S. Economic Growth Revised Higher on Spending, Inventories
Stocks have returned to meandering, looking for direction. Tech stocks are weak again, nothing seems to be going right for them. Even larger are trade issues & they are only in the first phase of bargaining. Uncertainty is high, making investors, many are not used to watch stocks stocks struggle, very nervous. The weak ones are selling. The Dow has a very gloomy chart over the last 2 months (see below) & that has been seen in years.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 64.59 | -0.66 | -1.0% |
| GC=F | Gold | 1,331.00 | -11.00 | -0.8% |
Pres Trump’s push to rebalance global trade in America's favor has investors on edge, as his threats to impose import tariffs & curb foreign investment raise the specter of retaliation that could spark a global trade war. The White House offensive is occurring on several fronts: it's renegotiating the North American Free Trade Agreement & has agreed to revise its bilateral trade pact with South Korea; it's in talks with nations & blocs that want exemptions from steel & aluminum tariffs & it's considering how to punish China for alleged theft of intellectual property. Beijing has threatened to retaliate by imposing tariffs of its own. The Trump administration’s tariffs on China will focus on high-tech industries where Beijing wants to lead, according to a senior White House trade adviser. The list of products the US hits with tariffs will line up with technologies China identified in its “Made in China 2025” strategy, White House adviser Peter Navarro said. “China in my view brazenly has released this China 2025 plan that basically told the rest of the world, ‘We’re going to dominate every single emerging industry of the future, and therefore your economies aren’t going to have a future,”’ Navarro added. “It’s artificial intelligence, robotics, quantum computing.”
U.S. Tariffs on China to Target Tech, Navarro Says: Trade Update
A gauge of signed contracts to purchase previously-owned US homes increased in Feb for the first time in 3 months, highlighting uneven progress in the industry, according to data from the National Association of Realtors. The index rose 3.1% M/M (est 2% gain) after a downwardly revised 5% decrease. The gauge fell 4.4% Y/Y on an unadjusted basis after a 1.9% decline. While the month-over-month gain shows demand for housing is still getting support from steady hiring, the market is facing several headwinds. Buyers are up against a persistent shortage of affordable listings to choose from, property prices continue to climb & mortgage costs are rising. What’s more, the Realtors group expects winter weather to weigh on demand in the Northeast. The NAR currently projects 2018 home sales will match 2017's 5.51M. The group expects the median selling price of a previously owned home to increase around 4.2% this year after 5.8% in 2017. “The expanding economy and healthy job market are generating sizeable homebuyer demand, but the miniscule number of listings on the market and its adverse effect on affordability are squeezing buyers and suppressing overall activity,” Lawrence Yun, NAR's chief economist, said. “Homeowners are already staying in their homes at an all-time high before selling and any situation where they remain put even longer only exacerbates the nation’s inventory crunch,” he added. The NAR's 2017 Profile of Home Buyers & Sellers showed the median tenure a homeowner stayed in their house before selling was 10 years, the highest in records back to 1981.
U.S. Pending Home Sales Increase for First Time in Three Months
The US economy grew in Q4 at a faster pace than last estimated, helped by an upward revision to household spending on services & a smaller drag from inventories, according to the Commerce Dept. GDP grew at a 2.9% annualized rate, (est 2.7%) revised from 2.5%. Consumer spending, biggest part of the economy, grew 4% (est 3.8%) revised from 3.8%. Before-tax corp pretax profits rose 2.7% Y/Y in the first estimate issued for Q4; climbed 5.3% in Q3. Inventories subtracted 0.53 ppt from GDP growth, compared with prior estimate of 0.7 ppt drag. Nonresidential fixed investment rose 6.8%, revised from 6.6% gain & reflecting a 6.3% jump in outlays for structures (prev est. 2.5%). GDP, adjusted for inflation, rose 0.9% following 2.4% gain in Q3. The revisions to GDP, the value of all goods & services produced in the US, indicate the economy was on a solid footing coming into the current qtr. The report also included the first look at the health of corp America toward the end of 2017. The gain in Q4 profits from a year earlier, together with lower corp taxes following the tax overhaul late last year, bodes well for business investment & employment. Household purchases, which account for about 70% of the economy, also are likely to be supported in coming months by bigger after-tax paychecks and the robust labor market. Continued gains in consumer spending & business investment will help to sustain the expansion even as GDP growth is projected to cool somewhat in Q1. The Federal Reserve Bank of Atlanta’s GDPNow tracking estimate for the current qtr was at 1.8% as of Mar 23. The latest forecast by economists called for a 2.5% pace. While the survey shows consumer spending slowing to a 2.1% rate, Fed officials remain upbeat about the prospects for households. Policy makers this month boosted their forecast for economic growth this year to 2.7% from 2.5% at their Dec meeting. The expansion, in its 9th year, is poised to become the 2nd-longest on record later in 2018. Price data in the GDP report showed inflation is hovering near the Fed's 2% goal. Excluding food & energy, the central banks's preferred price index that is tied to personal spending rose at an unrevised 1.9% annualized rate.
U.S. Economic Growth Revised Higher on Spending, Inventories
Stocks have returned to meandering, looking for direction. Tech stocks are weak again, nothing seems to be going right for them. Even larger are trade issues & they are only in the first phase of bargaining. Uncertainty is high, making investors, many are not used to watch stocks stocks struggle, very nervous. The weak ones are selling. The Dow has a very gloomy chart over the last 2 months (see below) & that has been seen in years.
Dow Jones Industrials
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