Dow rose 106, advancers over decliners 4-1 & NAZ rose 79 (1%). The MLP index bounced back 3 to 245 & the REIT index fell 3+ to the 349s. Junk bond funds crawled higher & Treasuries were sold. Oil rebounded 1 to the 54s & gold added 7 to 1228.
AMJ (Alerian MLP Index tracking fund)
Consumer sentiment for Nov fell more than anticipated in the final reading of the month, although the index remained near record highs. The Univ of Mich monthly survey of consumers slipped to 97.5 in final Nov reading, more than the fall to 98.3 expected. The key economic indicator hit 98.6 in Oct'’s final reading. “Although the data recorded a decline of 2.8 Index points following the election, the drop was related more to income than political party: among those with incomes in the bottom third, the Sentiment Index rose by 10.4 points and fell by 6.6 points among those in the top third of the income distribution,” Richard Curtin, chief economist for The Univ of Mich survey, said. The index has slumped since Mar when it reached its highest level since 2004 with a reading of 101.4.
Consumer sentiment slides in November as Americans expect less future income
Existing-home sales ran at a seasonally adjusted annual rate of 5.22M in Oct, the National Association of Realtors said. That was up 1.4% for the month, marking the first monthly increase in 6 months. Sales of previously-owned homes finally perked up, beating the forecast of a 5.18M selling pace. Still, Oct's rate of sales was 5.1% lower than a year ago. The median sales price in Oct was $255K, up 3.8% versus a year ago, one of the lowest yearly increases in a long time. Homes stayed on the market an average of 33 days in Oct & first-time buyers made up 31% of all purchases, still below the long-term average of 40%. Sales in the Northeast increased 1.5%, while sales in the South rose 1.9%. In the West, sales jumped 2.8%. The Midwest was the only region to pull back in Oct, with a 0.8% decline. At the current pace of sales, it would take 4.3 months to exhaust available supply, a tick lower than the 4.4 months' worth of unsold inventory notched last month, but still better than the conditions that likely caused many buyers to give up & exit the market late last year & early in 2018. For some context, the long-term average that's considered a sign of a “balanced” market is 6 months worth of inventory; in Feb, there were 3.4 months’ worth of unsold homes. With so much demand, it's not clear that any easing of the supply crunch won’t be met with a massive wave of buying that could even push prices to re-accelerate.
The US economy remains on a growth path, according to an index that measures the nation’s economic health, though the country’s expansion is likely to moderate. The leading economic index rose 0.1% in Oct after 0.6% and 0.5% gains in the prior 2 months, the Conference Board said. The forecast called for a 0.1% rise. The LEI is a weighted gauge of 10 indicators designed to signal business-cycle peaks & valleys. The leading index is the latest in a slew of economic signposts that show growth remains steady, if perhaps a bit slower than in early 2018. With job openings at a record high & unemployment at a 48-year low, Americans feel secure in their jobs & have money to spend. That will keep the economy growing in the near future, even as US interest rates rise.
Thanksgiving week is unusually gloomy with its worst start in almost ½ a century. Market breadth is decent today, but the averages only recovered a tiny portion of recent losses. Of course, many traders are away taking a long holiday. But economic fundamentals are stumbling a little more than might be expected following a string of favorable data. The consumer data & leading indicators will give traders a pause to assess the numbers. Then there is the sexy tech sector which has led the market rise this year. Their sharp decline in recent weeks spells a difficult time for their stocks & the overall market going forward. The Dow at 24.6K, is down more than 2K in the last 2 months. That's unsettling for the bulls.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 54.43 | +1.00 | +1.9% |
| GC=F | Gold | 1,227.30 | +6.10 | +0.5% |
Stocks rose as investors attempted to
recoup what was a bruising prior session that erased all of the annual
gains for US equities. All 3 of the major
averages were trading higher led by early gains in tech & consumer
discretionary shares ahead of the Thanksgiving holiday when the
financial markets are closed. Investors may be bargain hunting in the battered tech sector. The
so-called FANG stocks, Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX) & Google (GOOGL), have
shed a combined $1T plus in value from their record highs.
Investors eyed AAPL, which is sitting in a bear market, down 20%
from its Oct high. Oil also bounced back after falling the most in 3 years. Yesterday, Pres Trump indicated the US will
continue its working relationship with Saudi Arabia & later told
reporters oil prices were in "great shape." He followed up with a fresh
tweet today thanking the Saudis & touting "oil prices are
getting lower." In economic news, US Durable Goods orders dropped 4.4%, the
most in 15 months, suggesting a slowdown in business investment. There
are mounting concerns about the pace of global growth which spurred
fresh declines in stocks around the world, most notably wiping out
yearly advances for the S&P 500, Dow, while
NAZ hung on to fractional gains. In Europe, London's FTSE traded higher by 0.7%, Germany's DAX was up 0.5% France's CAC added 0.2%. US
stocks sold off across the board yesterday with the Dow falling over 600, before trimming those
declines. Losses accelerated in the final hour of trading as all major
S&P 500 sectors tumbled led by energy, industrials, financials &
tech. The volatility, in what is a short trading week due to
Thanksgiving, erased yearly gains for the Dow, S&P 500 &
essentially the NAZ.
Stocks attempt comeback after bruising session
Consumer sentiment for Nov fell more than anticipated in the final reading of the month, although the index remained near record highs. The Univ of Mich monthly survey of consumers slipped to 97.5 in final Nov reading, more than the fall to 98.3 expected. The key economic indicator hit 98.6 in Oct'’s final reading. “Although the data recorded a decline of 2.8 Index points following the election, the drop was related more to income than political party: among those with incomes in the bottom third, the Sentiment Index rose by 10.4 points and fell by 6.6 points among those in the top third of the income distribution,” Richard Curtin, chief economist for The Univ of Mich survey, said. The index has slumped since Mar when it reached its highest level since 2004 with a reading of 101.4.
Consumer sentiment slides in November as Americans expect less future income
Existing-home sales ran at a seasonally adjusted annual rate of 5.22M in Oct, the National Association of Realtors said. That was up 1.4% for the month, marking the first monthly increase in 6 months. Sales of previously-owned homes finally perked up, beating the forecast of a 5.18M selling pace. Still, Oct's rate of sales was 5.1% lower than a year ago. The median sales price in Oct was $255K, up 3.8% versus a year ago, one of the lowest yearly increases in a long time. Homes stayed on the market an average of 33 days in Oct & first-time buyers made up 31% of all purchases, still below the long-term average of 40%. Sales in the Northeast increased 1.5%, while sales in the South rose 1.9%. In the West, sales jumped 2.8%. The Midwest was the only region to pull back in Oct, with a 0.8% decline. At the current pace of sales, it would take 4.3 months to exhaust available supply, a tick lower than the 4.4 months' worth of unsold inventory notched last month, but still better than the conditions that likely caused many buyers to give up & exit the market late last year & early in 2018. For some context, the long-term average that's considered a sign of a “balanced” market is 6 months worth of inventory; in Feb, there were 3.4 months’ worth of unsold homes. With so much demand, it's not clear that any easing of the supply crunch won’t be met with a massive wave of buying that could even push prices to re-accelerate.
Existing-home sales stage their first increase in six months in October
The US economy remains on a growth path, according to an index that measures the nation’s economic health, though the country’s expansion is likely to moderate. The leading economic index rose 0.1% in Oct after 0.6% and 0.5% gains in the prior 2 months, the Conference Board said. The forecast called for a 0.1% rise. The LEI is a weighted gauge of 10 indicators designed to signal business-cycle peaks & valleys. The leading index is the latest in a slew of economic signposts that show growth remains steady, if perhaps a bit slower than in early 2018. With job openings at a record high & unemployment at a 48-year low, Americans feel secure in their jobs & have money to spend. That will keep the economy growing in the near future, even as US interest rates rise.
U.S. economy still on growth path, leading indicators show, but expansion likely to moderate
Thanksgiving week is unusually gloomy with its worst start in almost ½ a century. Market breadth is decent today, but the averages only recovered a tiny portion of recent losses. Of course, many traders are away taking a long holiday. But economic fundamentals are stumbling a little more than might be expected following a string of favorable data. The consumer data & leading indicators will give traders a pause to assess the numbers. Then there is the sexy tech sector which has led the market rise this year. Their sharp decline in recent weeks spells a difficult time for their stocks & the overall market going forward. The Dow at 24.6K, is down more than 2K in the last 2 months. That's unsettling for the bulls.
Dow Jones Industrials
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