Dow rose 48, advancers over decliners 2-1 & NAZ was up 25. The Financial Index rose 1 to the 201s, a 3 month high but 14 below its yearly high. The MLP index fell a fraction in the 391s after pretty much trading sideways for more than a month & the REIT fell 3 to the 265s. Junk bond funds edged higher but Treasuries sold off. Oil rose above $94 per barrel for the first time since May, buoyed by hopes for economic stimulus & on worries about supply disruptions. Gold hardly budged.
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Americans cut back on credit card use in Jun, more evidence that high unemployment & slow growth has made consumers more cautious about spending. Overall consumer borrowing rose because of increases in auto & student loans. The Federal Reserve said total borrowing increased 3% to $2.58T in Jun from May, just below the all-time high reached in Jul 2008. Credit card debt fell 5% to $864.6B. A category of borrowing that includes auto & student loans increased 7% to $1.71T. Americans have been relying less on credit cards since the 2008 financial crisis & recession that followed. But much of that has been offset by a dramatic increase in student loans.
US consumers cut back on credit card use in June AP
Photo: Bloomberg
In Jun, German factory orders declined more than twice as much as forecasted as sales to euro-area countries slumped. Orders dropped 1.7% from May, when they rose 0.7% according to the Economy Ministry in Berlin. The forecast was for a decline of 0.8%. From a year earlier, orders fell 7.8% (after adjusting for work days). This is the latest report showing that Europe's largest economy is cooling as the sovereign debt crisis erodes demand for its goods, hurting its companies. While the Bundesbank last month estimated moderate growth in Q2, aided by domestic spending, the manufacturing industry is contracting & business confidence fell for a 3rd straight month in Jul. Orders from the euro region sank 4.9% in Jun after jumping 7.8% in May. Domestic orders fell 2.1%, while demand from non-euro nations rose 0.6%. The economy ministry said overall orders in Q2 “slightly” exceeded those in Q1, there is currently no clear trend. Rising wages & unemployment at a 2-decade low are supporting domestic spending, helping to offset waning export demand. The Bundesbank in Jun predicted German growth of just 1% this year. By contrast, the European Commission forecasts a 0.3% contraction for the 17-nation euro economy as a whole. With the global economy cooling & the debt crisis hurting spending in the euro region, German companies are feeling the pinch.
June Factory Orders Fell Twice as Much as Forecast as Crisis Hits Output
Freddie Mac said a strengthening housing market means it will not add to the debt it owes US taxpayers for the first time in a year. Net income of $3B in Q2 (after a div payment to the Treasury of $1.8B) will allow the company to avoid additional help for now. Provisions for credit losses fell as the housing market improved. The company also did not require aid during the last 3 qtrs in 2009. Fannie Mae & Freddie Mac have taken almost $190B in assistance from the Treasury since they went into conservatorship after investments in risky loans pushed them to the brink of insolvency. This is also a sign of a housing market that is mending, but slowly.
Freddie Mac Won’t Seek Treasury Aid for First Time Since 2008
Markets have following winds bringing higher stock prices. The news is really not all that good, but a lack of bad news is encouraging the risk appetite of investors. One key measure is the € which was little changed today, but at $1.24 is up a good 3 pennies from where it was just 2 weeks ago. Hopes are riding high that more bond buying in Europe will solve problems. Dow is doing well, but is still 250 below its 2012 highs. NAZ closed above 3K & the S&P 500 went back above 1400, an important technical indicator. The S&P chart for the last 6 months is included below.
AMJ (Alerian MLP Index tracking fund)
Click below for the latest market update:
Treasury yields:
U.S. 3-month | 0.101% | |
U.S. 2-year | 0.260% | |
U.S. 10-year | 1.630% |
| CLU12.NYM | ...Crude Oil Sep 12 | ...93.90 | ... 1.70 | (1.8%) |
Americans cut back on credit card use in Jun, more evidence that high unemployment & slow growth has made consumers more cautious about spending. Overall consumer borrowing rose because of increases in auto & student loans. The Federal Reserve said total borrowing increased 3% to $2.58T in Jun from May, just below the all-time high reached in Jul 2008. Credit card debt fell 5% to $864.6B. A category of borrowing that includes auto & student loans increased 7% to $1.71T. Americans have been relying less on credit cards since the 2008 financial crisis & recession that followed. But much of that has been offset by a dramatic increase in student loans.
US consumers cut back on credit card use in June AP
In Jun, German factory orders declined more than twice as much as forecasted as sales to euro-area countries slumped. Orders dropped 1.7% from May, when they rose 0.7% according to the Economy Ministry in Berlin. The forecast was for a decline of 0.8%. From a year earlier, orders fell 7.8% (after adjusting for work days). This is the latest report showing that Europe's largest economy is cooling as the sovereign debt crisis erodes demand for its goods, hurting its companies. While the Bundesbank last month estimated moderate growth in Q2, aided by domestic spending, the manufacturing industry is contracting & business confidence fell for a 3rd straight month in Jul. Orders from the euro region sank 4.9% in Jun after jumping 7.8% in May. Domestic orders fell 2.1%, while demand from non-euro nations rose 0.6%. The economy ministry said overall orders in Q2 “slightly” exceeded those in Q1, there is currently no clear trend. Rising wages & unemployment at a 2-decade low are supporting domestic spending, helping to offset waning export demand. The Bundesbank in Jun predicted German growth of just 1% this year. By contrast, the European Commission forecasts a 0.3% contraction for the 17-nation euro economy as a whole. With the global economy cooling & the debt crisis hurting spending in the euro region, German companies are feeling the pinch.
June Factory Orders Fell Twice as Much as Forecast as Crisis Hits Output
Freddie Mac said a strengthening housing market means it will not add to the debt it owes US taxpayers for the first time in a year. Net income of $3B in Q2 (after a div payment to the Treasury of $1.8B) will allow the company to avoid additional help for now. Provisions for credit losses fell as the housing market improved. The company also did not require aid during the last 3 qtrs in 2009. Fannie Mae & Freddie Mac have taken almost $190B in assistance from the Treasury since they went into conservatorship after investments in risky loans pushed them to the brink of insolvency. This is also a sign of a housing market that is mending, but slowly.
Freddie Mac Won’t Seek Treasury Aid for First Time Since 2008
Markets have following winds bringing higher stock prices. The news is really not all that good, but a lack of bad news is encouraging the risk appetite of investors. One key measure is the € which was little changed today, but at $1.24 is up a good 3 pennies from where it was just 2 weeks ago. Hopes are riding high that more bond buying in Europe will solve problems. Dow is doing well, but is still 250 below its 2012 highs. NAZ closed above 3K & the S&P 500 went back above 1400, an important technical indicator. The S&P chart for the last 6 months is included below.
S&P 500
Dow Jones Industrials
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