Dow dropped 356, decliners over advancers 4-3 & NAZ slid back 53. The MLP index stayed near 230 & the REIT index fell 3 to 404. Junk bond funds edged higher & Treasuries had a little buying, slightly lowering yields. Oil was off slightly in the 78s & gold inched up 1 to 1946.
AMJ (Alerian MLP Index tracking fund)
Caterpillar (CAT), a Dow stock, in Q4 quarterly sales increased by 20%, aided by
higher prices on its equipment that helped offset rising expenses for
manufacturing & the strengthening $. Demand for its construction & mining machinery &
engines remained strong, especially in North America, as sales for the
qtr were higher than expected. CAT has raised prices in response to higher costs. Higher prices boosted quarterly sales
by $1.74B from the same period last year, while higher sales
volumes of equipment added $1.56B. Unfavorable exchange rates
when sales in foreign currencies were converted into $s
chopped $523M from sales in the qtr. CAT reported some supply chain improvement during the qtr
that allowed higher shipments from its plants. But elevated costs for
materials & freight shipping & constricted supplies of key
components, including semiconductor chips, persisted. "We
certainly did still experience inefficiencies with supply-chain
challenges" said CEO Jim Umpleby said. "It’s not anywhere as smooth as it needs to be." Quarterly sales increased by 20%, aided by
higher prices on its equipment that helped offset rising expenses for
manufacturing & the strengthening of the $. For the 3 months ended Dec 31 EPS was $2.79, down from $3.91 in the same period a year earlier. Stripping out one-time items,
adjusted EPS came to $3.86, missing the
estimate of $4.02. Revenue from the
qtr, including the company's equipment financing arm, was $16.6B. The stock fell 3.44.
If you would like to learn more about CAT, click on this link:
club.ino.com/trend/analysis/stock/CAT_aid=CD3289&a_bid=6ae5b6f7
Caterpillar earnings show sales up 20% on strong demand
Wages & benefits for workers in most major US cities grew at a slower pace in the final 3 months of 2022, with inflation still outstripping pay for many workers. The employment cost index, a quarterly measurement of labor costs, climbed 1% in the Oct-Dec period, the Labor Dept reported. That is below both the 1.2% reading in Q3 & the 1.1% forecast, the lowest quarterly gain in a year. Annually, wages & salaries rose 5.1% in the 12 months thru Dec. That compares to a final year-end inflation rate of 6.5%, meaning that Ms of Americans saw their pay increase wiped out by steep consumer prices last year. "The core private wages and salaries advance slowed for the second consecutive quarter, which is consistent with the deceleration in other wage measures, including average hourly earnings," said Kathy Bostjancic, the chief economist at Nationwide. "Benefit costs also increased at the slowest in over a year, which allowed the year-on-year rate to slip to below 5% to 4.9%." While wage growth is moderating across most of the country, there is still some divergence in compensation. Miami, which has been a hotbed for inflation, saw wages grow by 6.8%, well above the national trend. However, that is still lower than the local inflation rate of 9.9%.
Inflation still outstripping wages in most US cities
After a stronger start to the year, mortgage demand plunged last week, despite another drop in interest rates. Total mortgage application volume fell 9% last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726K or less) decreased to 6.19% from 6.20%, with points falling to 0.65 from 0.69 (including the origination fee) for loans with a 20% down payment. The rate was 3.78% the same week one year ago. Even with rates well off their recent highs, applications to refinance a home loan fell 7% for the week & were 80% lower than the same week one year ago. Homeowners may have jumped back briefly after the holiday lull, causing demand to rise over much of Jan, but overall there are still very few borrowers who can benefit from a refinance at today’s rates, so demand is now falling again. Mortgage applications to buy a home fell 10% for the week & were 41% lower year over year. While both home prices & mortgage rates are coming down steadily, the supply of homes for sale is still quite low, & that may be keeping mortgage demand under pressure. “Purchase activity is expected to pick up as the spring homebuying season gets underway, bolstered by lower rates and moderating home-price growth,” said Joel Kan, an MBA economist. “Both trends will help some buyers regain purchasing power.” Mortgage rates have been moving in a narrow range for the last few days, but that could all change depending on commentary expected from the chair of the Federal Reserve today. The central bank is expected to hike its interest rate, but that doesn't necessarily raise mortgage rates. The monthly employment report Fri could also move rates decidedly, depending on what it says about the state of the economy, recession and inflation.
Mortgage demand took a big step back last week, even after interest rates fell further
Everybody is waiting for the Fed to speak, & also to hear from OPEC+ on production levels.
Dow Jones Industrials
No comments:
Post a Comment