Dow inched up 1, advancers over decliners about 5-4 & NAZ added 29. The MLP index dropped 2 to 248 & the REIT index rose 3+ to 382. Junk bond funds fluctuated & Treasuries were sold. Oil fell 1+ to the 61s & gold sank a very big 15 to 1269 (a more than 4 month low).
AMJ (Alerian MLP Index tracking fund)
club.ino.com/trend/analysis/stock/CAT?a_aid=CD3289&a_bid=6ae5b6f7
Caterpillar hikes dividend to record levels as outlook remains rosy
Factory orders jumped in Mar after 2 straight declines, the Commerce Dept said. Orders rose a seasonally adjusted 1.9% after a revised 0.3% drop in Feb, the latest data show. The increase was ahead of the 1.7% forecast advance. In Mar, transportation equipment jumped by 7%, while new orders for nondurable goods increased 1.1%. Excluding transportation, orders rose 0.8%.
The productivity of American workers soared in Q1 & pushed the increase over the past year to the highest level since 2010, a potentially great sign for the US economy. The productivity of American workers increased at a 3.6% annual pace from Jan-Mar, the gov said. That's the biggest gain since the fall of 2014. The forecast called for a 2.9% increase. Until very recently, the growth in productivity has been stubbornly weak & a major black mark on a nearly 10-year-old expansion. It's averaged just 1.3% a year since 2007, well below the 2.7% rate from 2000-2007 or a postwar average of slightly more than 2%. Productivity has increased 2.4% in the past 12 months, the fastest clip since 2010, a period when it increased largely because companies cut hoards of jobs during last recession & basically forced remaining workers to do more with less. Higher productivity is a magic elixir or sorts that over time allows an economy to grow faster without stoking inflation. Companies increased the number of goods & services they produced, known as output, by a healthy 4.1%. And they managed it even though the hours workers spent on the job rose a mild 0.5%. Meanwhile, unit-labor costs declined 0.9%. Over the past year unit-labor costs, how much it costs to make each product, have risen a scant 0.1% to mark the smallest increase since 2013. The decline in unit-labor costs adds to a slew of recent evidence that inflation has waned after a sharp burst last year & poses little threat to the economy. The increase in productivity in Q4, meanwhile, was revised down to 1.3% from 1.9%. The low level of productivity in the past decade has puzzled economists for years, but fresh evidence suggests some of the recent gains might be longer lasting. Companies have invested more in technology & workers in the past few years, the first step in enabling them to produce more goods & services in the same amount of time. The potential benefits of higher productivity are immense: Higher profits, rising wages & an improved standard of living for American families. What’s still unclear, however, is whether the recent increase can be sustained. Business investment tapered off toward the end of 2018 & the outlook for this year is uncertain. Some economists also contend that a bout of fiscal stimulus, tax cuts & more gov spending, has given productivity a temporary boost.
Traders have a lot to digest. Economic data is inconclusive & recent earnings have varied. The US-China trade talks lumber along, but a signed deal does not seem near after encouraging comments yesterday. However the bulls are keeping the popular stock averages near record highs.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 61.99 | -1.61 | -2.5% |
| GC=F | Gold | 1,271.00 | -13.20 | -1.0% |
Caterpillar (CAT), a Dow stock, plans to start paying divs to investors in historic amounts. The industrial giant said it would raise its quarterly div
by 20% to a record $1.03 per share. It also
plans to increase the div every year for the next 4 years by “at
least a high-single digit percentage.” Meanwhile,
CAT plans to repurchase shares on a more consistent basis "with
the goal of at least offsetting dilution in the market downturns." The decision, which was released ahead of its annual investor day, comes after CAT last month reported & raised its 2019 profit outlook, alleviating fears of a significant
global economic slowdown this year given the firm's extensive
intl operations. CEO Jim Umpleby said the firm is “a stronger and more profitable company
that can produce higher free cash flow thru the cycles.” The company is hoping to improve operating margins by up to 6.0% above the
performance levels in 2010-2016, underscored by what it says is a
focus on “operational excellence and investing in expanded offerings and
services.” Key to the profit outlook is a
focus on growing the services business. The company is hoping to double
sales in the sector by 2026 to $28B. “Our enterprise strategy for profitable growth is working,” said
Umpleby. "We will continue to execute our strategy while investing to
double services sales by 2026, an area of significant opportunity for
further profitable growth." But the stock fell 1.88
If you would like to learn more about CAT, click on this link:club.ino.com/trend/analysis/stock/CAT?a_aid=CD3289&a_bid=6ae5b6f7
Caterpillar hikes dividend to record levels as outlook remains rosy
Factory orders jumped in Mar after 2 straight declines, the Commerce Dept said. Orders rose a seasonally adjusted 1.9% after a revised 0.3% drop in Feb, the latest data show. The increase was ahead of the 1.7% forecast advance. In Mar, transportation equipment jumped by 7%, while new orders for nondurable goods increased 1.1%. Excluding transportation, orders rose 0.8%.
Factory orders jump in March after two declines
The productivity of American workers soared in Q1 & pushed the increase over the past year to the highest level since 2010, a potentially great sign for the US economy. The productivity of American workers increased at a 3.6% annual pace from Jan-Mar, the gov said. That's the biggest gain since the fall of 2014. The forecast called for a 2.9% increase. Until very recently, the growth in productivity has been stubbornly weak & a major black mark on a nearly 10-year-old expansion. It's averaged just 1.3% a year since 2007, well below the 2.7% rate from 2000-2007 or a postwar average of slightly more than 2%. Productivity has increased 2.4% in the past 12 months, the fastest clip since 2010, a period when it increased largely because companies cut hoards of jobs during last recession & basically forced remaining workers to do more with less. Higher productivity is a magic elixir or sorts that over time allows an economy to grow faster without stoking inflation. Companies increased the number of goods & services they produced, known as output, by a healthy 4.1%. And they managed it even though the hours workers spent on the job rose a mild 0.5%. Meanwhile, unit-labor costs declined 0.9%. Over the past year unit-labor costs, how much it costs to make each product, have risen a scant 0.1% to mark the smallest increase since 2013. The decline in unit-labor costs adds to a slew of recent evidence that inflation has waned after a sharp burst last year & poses little threat to the economy. The increase in productivity in Q4, meanwhile, was revised down to 1.3% from 1.9%. The low level of productivity in the past decade has puzzled economists for years, but fresh evidence suggests some of the recent gains might be longer lasting. Companies have invested more in technology & workers in the past few years, the first step in enabling them to produce more goods & services in the same amount of time. The potential benefits of higher productivity are immense: Higher profits, rising wages & an improved standard of living for American families. What’s still unclear, however, is whether the recent increase can be sustained. Business investment tapered off toward the end of 2018 & the outlook for this year is uncertain. Some economists also contend that a bout of fiscal stimulus, tax cuts & more gov spending, has given productivity a temporary boost.
Productivity soars 3.6% in first quarter, drives fastest yearly gain since 2010
Traders have a lot to digest. Economic data is inconclusive & recent earnings have varied. The US-China trade talks lumber along, but a signed deal does not seem near after encouraging comments yesterday. However the bulls are keeping the popular stock averages near record highs.
Dow Jones Industrials
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