Dow dropped 424, decliners over advancers about 3-1 & NAZ pulled back 223. The MLP index was off 2 to 200 & the REIT index fell 2+ to the 453s. Junk bond funds slid lower & Treasuries saw heavy buying (more below). Oil was off 2+ to the 91s & gold soared 25 to 1896.
AMJ (Alerian MLP index tracking fund)
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The number of Americans filing for unemployment benefits
unexpectedly ticked up last week, rising for the first time in a month
despite elevated business demand for workers & easing omicron cases
nationwide. Data from the Labor Dept
show that applications for last week rose to 248K from
an upwardly revised 225K a week earlier, missing the 219K forecast. Continuing
claims, or the number of Americans who are consecutively receiving
unemployment aid, fell to 1.6M, a decrease of 26K from the
previous week. The report shows that roughly 2M Americans were collecting
jobless benefits, a modest decrease from the
previous week. By comparison, just a little over one year ago, 19M Americans were receiving benefits. Claims have
largely moderated as the economy recovers from the pandemic &
Americans venture out to travel, shop & eat. Businesses have struggled
to keep up with the demand, however & have reported difficulties in
onboarding new employees. Despite the slight uptick in claims, today's report suggests that companies are making an effort to retain
the workers they already have. Earlier this month, the Labor
Dept reported that employers hired 467K new workers in Jan,
a surprising increase given the surge in COVID-19 cases. It also
revised its estimate for job gains in Nov & Dec by a
combined 709K.
Number of jobless Americans unexpectedly rises
Walmart (WMT), a Dow stock & Dividend Aristocrat, CFO Brett Biggs said shoppers aren't trading down
to cheaper brands, buying smaller packs or skipping over discretionary
items — but said they are paying attention to rising prices. “We
haven’t seen any marked changes at this point in how they’re shopping,”
he said. But, he added, “we do know,
we’ve seen and we heard through our own studies that people are
certainly focused on inflation and they’re seeing that in their daily
lives.” Inflation is driving up costs of food, fuel, vehicles & more across the country. The consumer price index rose by 7.5%
in Jan compared with a year ago, the fastest jump in four decades. Food costs are up 7% over the past
year — & grocery is WMT's largest sales category. Those climbing expenses have become a focal point for investors,
who are watching to see if & when Americans' spending patterns
change. Household budgets may get squeezed by another factor, too: As
the omicron wave of Covid recedes, consumers may spend more on commuting
or dining out. Fiscal Q4 earnings topped expectations & the company reiterated its forecast for the year. A portion of its sales came from higher prices. Same-store
sales, a key retail metric, grew by 5.6% in the US. More than ½ came
from selling goods rather than rising prices, as store & website
traffic rose 3.1%. Biggs said the retailer has kept customers &
shareholders in mind as it tries to walks the line between keeping
prices low & profits high. He added it is taking a balanced approach as
it raises prices on some grocery items & not others. “During periods of inflation like this, middle income families, lower
middle income families, even wealthier families become more price
sensitive,” he said. “And that’s to our advantage.” The stock fell 2.31.
If you would like to learn more about WMT click on this link:
club.ino.com/trend/analysis/stock/WMT_aid=CD3289&a_bid=6ae5b6f
Walmart CFO Brett Biggs says customers are paying attention to rising prices
Treasury yields fell, as investors monitored developments on the Russia-Ukraine crisis. The yield on the benchmark 10-year Treasury note gave up 7.7 basis points, falling to 1.968% & the yield on the 30-year Treasury bond moved 7.6 basis points lower to 2.288%. Yields move inversely to prices & 1 basis point is equal to 0.01%. Geopolitical tensions continued to be in focus for investors. The US Ambassador to the UN said the conflict had reached a “crucial moment.” Ukraine accused pro-Russian separatists of attacking a village near the border. “The evidence on the ground is that Russia is moving toward an imminent invasion,” Ambassador Linda Thomas-Greenfield said. On the economic front, Jan's housing starts & the weekly jobless claims data came in worse than expected. But Jan's building permits data did beat expectations to the upside.
Treasury yields fall, with Fed update and Russia-Ukraine crisis in focus
Dow Jones Industrials
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