Dow rose 192, advancers over decliners 5-2 & NAZ jumped 152. The MLP index was off 1 to the 193s & the REIT index gained 3+ to 477. Junk bond funds fluctuated & Treasuries were sold, bringing higher yields. Oil slid back in the 82s & gold was about even at 1798.
AMJ (Alerian MLP index tracking fund)
|
|
US economic growth decelerated in Q3 as consumer spending slowed amid a resurgence in new COVID-19 cases & as gov assistance payments decreased. Gross domestic product (GDP) grew at a 2% annual rate during the 3 months thru Sep, the weakest of the recovery, according to an advance estimate by the Commerce Dept. The forecast expected 2.7% growth. Q2 GDP was 6.7%. Personal consumption grew at a 1.6% pace after accelerating 12% during Q2. Businesses have since the reopening of the global economy struggled to keep store shelves stocked due to supply-chain bottlenecks & labor deficiencies. The supply shortages have resulted in higher prices for the consumer. Core personal consumption expenditures, the Federal Reserve's preferred inflation measure, increased 4.5% in Q3. While that was below the 6.1% increase in Q2, it remained well above the Fed's 2% long-term target. Increases in private inventory investment, personal consumption expenditures, state & local gov spending & nonresidential fixed investment were partly offset by a drop in residential fixed investment, federal gov spending, & exports. Weaker motor vehicle expenditures subtracted 2.39 percentage points from GDP during the qtr. Record imports of foreign goods resulted in net exports deducting 1.14 percentage points from growth.
US economic growth falls short of expectations as consumer spending slows
The reconciliation framework Pres Biden plans to announce to House Dems at their caucus meeting will include an estimated almost $2T pay-fors, including a tax on stock buybacks, efforts by the IRS to stop tax dodgers & more. The plan will also include a child tax credit, universal preschool & a modified Medicaid expansion, among other things. Notably not in the plan are universal community college, paid family leave & other policies. "The president believes this framework will earn the support of all 50 Democratic senators and pass the House," a senior administration official said. "He will defer to Speaker Pelosi… on the specific timing of votes, but he will be full-throated that he believes each of these bills should pass when they come." An official added: "We're not going to speak for any lawmakers from here… But our bottom line is we are confident that this will earn the support of every Democratic senator pass the House." The White House estimates that its plan will cost $1.75T & that its pay-fors would raise $1,995T. There is no bill text to these claims have not actually been evaluated by the Congressional Budget Office or any independent watchdogs. Among the pay-fors will be a 15% corp minimum tax ($325B) ; a 1% surcharge on corp stock buybacks ($125B); a global minimum tax of 15% & a penalty for foreign companies that are based in countries without a minimum tax ($350B); a millionaires & billionaires surtax ($230B); closing a Medicare tax loophole ($250B); increased IRS enforcement aimed at the wealthy ($400B); limiting tax deductions for business losses for wealthy people ($170B) & the repeal of the prescription drug rebate rule ($145B).
Biden reconciliation framework costs $1.75T, includes $1.995 trillion in tax hikes, White House says
Pending home sales, which are a measure of signed contracts to buy existing homes, fell an unexpected 2.3% in Sep compared with Aug, according to the National Association of Realtors (NAR). The forecast called for a slight monthly gain. Sales were 8% lower compared with Sep 2020. Pending sales are a forward-looking indicator of closed sales in 1-2 months. Sales may have dropped due to higher mortgage rates. The average rate on 30-year fixed-rate mortgages fell below 3% in Jul & stayed there until the first week of Sep, according to Mortgage News Daily. Then it began rising & crossed over 3%, ending the month at 3.15%. Buyers are also still contending with very high home prices. Price gains have been close to 20% year over year. There was a sign, however, in Aug that the market was cooling, with fewer bidding wars & slightly more supply coming up for sale. “Contract transactions slowed a bit in September and are showing signs of a calmer home price trend, as the market is running comfortably ahead of pre-pandemic activity,” said Lawrence Yun, NAR's chief economist. “It’s worth noting that there will be less inventory until the end of the year compared to the summer months, which happens nearly every year.”
Pending home sales fell unexpectedly in September, likely due to higher mortgage rates
Dow Jones Industrials
No comments:
Post a Comment